A leading member of the New Patriotic Party (NPP), Gabby Otchere-Darko, has cautioned the governing party against playing the politics of equalization with the opposition, National Democratic Congress (NDC), on inflation, interest rates and cedi depreciation.
He revealed that this is not an election year for the NPP to to treat Ghanaians like voters. With this, he urged the ruling party to regard the people in the country as citizens.
In a tweet post, Mr Otchere-Darko stated that the “politics of comparisons” only works when elections are within sight.
“Right now people just care about how to make ends meet. Use your energy in showing what is being done to bring relief. NPP shouldn’t play the politics of equalization with the NDC on inflation, interest rates and cedi depreciation. The world is facing an economic crisis like never before in this time. Ghana has been hit very hard because our economic recovery was being delicately managed pre-COVID.”
The former Executive Director of the Danquah Institute highlighted that currently, people just care about how to make ends meet. As such, government must use its energy “in showing what is being done to bring relief”.
Meanwhile, the International Monetary Fund has attributed the high inflation in Ghana to domestic factors.
Ghana’s inflation is due to domestic factors
In a press conference at the recent IMF/World Bank Spring Meetings, the African Director at the Fund, Abebe Selassie, disclosed that its analysis indicate that inflation is driven more by domestic factors than exogenous factors.
“On inflation, I mean, again, there are always trade-offs when you’re doing policy calibration, and so in our regional economic outlook, we are very careful to flag that there are some countries where inflation has clearly been driven more by domestic factors than exogenous factors. I think Ghana would fall in that camp.”
Abebe Selassie
Conversely, he stated that there are also quite a number of other countries where the inflation being witnessed is more of “imported inflation”. Regarding this, he explained that the scope and the space and the ability of monetary policy to address that is limited.
“So again, it depends on country-specific circumstances, and on time”.
Abebe Selassie
Mr Abebe indicated that the calibration of monetary policy must be always agile. This, he explained, is because the conditions that affect inflation are always changing.
“Exchange rates are moving, commodity prices are moving, so it’s an area where, calibration must be looked at again and again and again as the months proceed. That’s why Central Bank can say you have to be forward-looking [and] data-driven. So, our advice is also very much subject to those considerations”.
Abebe Selassie
Prior to this, Vice President of IMANI Africa, Bright Simons, explained why it is unrealistic to blame all of government’s economic woes on external factors.
According to him, procurement breaches are a very pivotal cause of the current situation. He argued that Ghana has a “systemic waste that is frightening and terrifying”, but not as blatant in some counties like Nigeria and Kenya.
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