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Ghanaians to Face More Hardship Amid Slow Economic Growth, Economists Say

The economic performance of Ghana for 2021 will pose more economic hardship to the populace as the country experiences slow growth in the coming year, economists say.

Dr. Patrick Asuming and Dr. Agyapomaa Gyeke-Dako, the Economists, made their assertions in an interview with the Ghana News Agency based on the macroeconomic indicators and performance of the economy as provided in the 2022 budget and economic policy document.

Data provided in the budget showed that the country as of October 2021 had missed the inflation target of 8 percent, reaching 11 percent, which was higher than the 10.1 percent recorded in the same period in 2020.

There was an overall budget deficit (cash) of 7.7 percent of gross domestic product (GDP) against the target of 7.4 percent of GDP. The budget deficit for the same period in 2020 was 8.6 percent of GDP.

Additionally, the public debt as a percentage of GDP stood at 77.8 percent at the end of September 2021, up from 76.1 percent at the end of December 2020.

At the end of the first quarter, the country’s debt was GH₵304.6 billion implying a percentage increment of 9.2 percent. This had increased to GH₵332.4 billion after an additional debt of GH₵27.8 billion in April and May 2021.

In terms of economic growth, data released in September 2021 indicated that overall real GDP grew by 3.1 percent in Q1 and 3.9 percent in Q2, averaging 3.5 percent in the first half of 2021 against the 0.7 percent growth in the same period 2020.

Dr. Asuming, Senior Lecturer at the University of Ghana Business School (UGBS), explained that despite the growth recorded in real GDP last year, the high inflation meant that “people’s real income have gone down and the cost of living has gone up.”

“The inflation number being above the target also means that things are more expensive than we thought so the cost of living is high and it’s going to be higher than we initially expected,” he added.

SOURCE: NEWS GHANA

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