Kenneth Thompson, Chief Executive Officer, Dalex Finance Limited, on Wednesday said Ghana stands to face grave economic challenges in 2021, if government does not adopt the right economic recovery strategy.<\/p>\n
He said the Ghanaian economy was in recession after two consecutive quarters of negative Gross Domestic Product growth, adding that, the standard prescription for a recovery from recession was an economic stimulus package and yet Ghana was \u2018broke\u2019.<\/p>\n
Mr Thompson made this remark in an interview with the Ghana News Agency on the country\u2019s economic prospects in the year 2021, \u201clooking through the crystal ball\u201d.<\/p>\n
He said the only way the country could start to fund a half-way decent stimulus package in 2021 was either to borrow about five billion dollars on the international capital markets or the country must reign in expenditure and increase tax revenue.<\/p>\n
He described the solutions as a choice between the \u2018devil and the deep blue sea\u2019, saying, that was the situation President Nana Addo Dankwa Akufo-Addo would be facing either to borrow more or increase revenue mobilisation.<\/p>\n
\u201cDespite the rhetoric and the one hundred-billion-cedi Ghana Cares \u2018Obaatampa\u2019 programme, President Akufo-Addo, is facing a choice between \u201cthe Devil\u201d and \u201cthe Deep Blue Sea\u201d with respect to the economy.<\/p>\n
\u201cHe faces the possibility of going down in history as the all-time \u2018President of Public Debt\u2019 or the \u2018President of Austerity\u2019,\u201d he said.<\/p>\n
He said the economic recession if not well managed would result in a spectra of high unemployment, reduced revenue collection combined with increased demand for stimulus packages.<\/p>\n
\u201cBusinesses face reduced demand, revenues and profits. Customer defaults will rise and this will trigger staff layoffs and other unpleasant cost-cutting measures,\u201d he said.<\/p>\n
He said if government decided on a continuous borrowing trajectory, it could lead to the Ghanaian economy crashing, the effects of which would be heavy cuts to government expenditure, massive layoffs, unemployment, currency crash, and a low standard of living.<\/p>\n
He said to avert the risk of debt distress, the country must reign in expenditure and increase tax revenue.<\/p>\n
\u201cTo reign in expenditure, projects that have made the government popular will have to be severely curtailed or cancelled. These include; Free SHS, free water and electricity, NABCO and payments to depositors with defunct financial institutions,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":"
Kenneth Thompson, Chief Executive Officer, Dalex Finance Limited, on Wednesday said Ghana stands to face grave economic challenges in 2021, if government does not adopt the right economic recovery strategy. He said the Ghanaian economy was in recession after two consecutive quarters of negative Gross Domestic Product growth, adding that, the standard prescription for a […]<\/p>\n","protected":false},"author":86,"featured_media":8395,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,5,8],"tags":[],"class_list":["post-8392","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-economy","category-homepage-english"],"yoast_head":"\n