Editorial: National Economic Dialogue to reset Ghana underway

Indeed, the journey to reset Ghana’s economy will not be an easy task, Chairman of the seven-member National Economic Dialogue Committee, Dr. Ishmael Yamson, disclosed this at the National Economic Dialogue under the theme ‘Resetting Ghana: Building the Economy We Want Together’ yesterday, Monday, March 3.

Dr. Ishmael Yamson noted that the process of rebuilding the economy will be rough and filled with risks and frustrations from both internal and external sources. This notwithstanding, Chairman Yamson expressed confidence in President Mahama’s determined leadership.

He however emphasised that the majority of economic challenges in the country’s are homegrown and self-inflicted. Despite the magnitude of issues at hand, Dr. Yamson believes they can be resolved through collective effort by both the leadership and citizens at large, and stressed the importance of unity and determination in overcoming the country’s economic difficulties.

Emphasising the critical role of leadership in national development, Dr. Yamson noted that economic transformation across the world has often been driven by a single visionary leader.

Ghana’s economic crisis came to a head in 2022, driven by a combination of structural weaknesses and external shocks including the COVID-19 pandemic, Russia’s invasion of Ukraine and tightening global financial conditions.

Before the pandemic, the nation had maintained an expansionary fiscal policy financed largely by commercial debt – which worsened its macroeconomic vulnerabilities. By 2022, the country faced a steep rise in debt levels from 79.6 percent of Gross Domestic Product (GDP) in 2021 to 92.4 percent in 2022, soaring inflation from 12.6 percent to 54.1 percent, a rapid depreciation of the cedi and dwindling foreign reserves.

The loss of access to Eurobond markets and declining investor confidence triggered capital outflows, further weakening the economy. As government relied heavily on domestic borrowing, rising interest rates stifled private sector activity – slowing GDP growth to 3.1 percent in 2022 and exacerbating the fiscal crisis.

President John Mahama, in reading the State of the Nation Address to parliament last week, stated that the two-day National Economic Dialogue and presentation of the budget statement on March 11 will present the real level of Ghana’s economic crisis to the people.

For his part, Minister for Finance Dr. Cassiel Ato Forson assured Ghanaians that government remains committed to implementing reforms that will stabilise the economy and promote long-term growth.

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