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Dr. Mohammed Amin Adam, Minister of Finance
The Institute for Fiscal Studies (IFS) has described Ghana’s economy as still weak and fragile, claiming that the country’s macroeconomic environment remains unstable.
The IFS questioned the government’s claim in its mid-year budget that the economy was out of the woods.
Finance Minister Mohammed Amin Adam, in his mid-year budget review last month, noted that key economic indicators such as slowing inflation and a narrowing deficit pointed to a recovery in the economy.
However, the Institute for Fiscal Studies has disputed those claims, saying the economy remains weak and fragile.
Speaking at a press conference on Ghana’s current fiscal and macroeconomic performance, Executive Director, Dr. Said Boakye, said despite the slowdown in Ghana’s economy, indicators were still below historical levels and were also at low levels among other countries on the African continent.
“Although Ghana is far from an ideal country in terms of inflation rate, from June 2010 to December 2012, Ghana had single-digit inflation for 31 consecutive months, averaging 9.0%, and even from 2010 to 2021, the annual average inflation rate was 11.8%, but if the inflation rate reaches 22.8% by June 2024, it will be too dangerous,” Dr. Said Boakye pointed out.
The IFS also questioned the government’s revenue targets, insisting the revised figures were too ambitious.
“Contrary to the optimism expressed by the Minister of Finance, Dr Amin Adam, on revenue mobilisation when he tabled the 2024 Mid-Year Fiscal Policy Review in Parliament, data shows that revenue mobilisation remains a major challenge for the government.
“The revised total revenue and subsidy target of 17.4% of GDP for 2024 is indeed out of sync with reality and therefore unachievable,” he stressed.
The IFS further urged the government to prioritise prudence over power in its campaign policy messaging and to rein in spending despite this year’s election.
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