Road to economic recovery will be rough
The Finance Minister, Mr Seth Terkper, has painted a positive picture of the country’s economy, in spite of the concerns raised by captains of business and industry, civil society groups and individuals.
Questions relating to the country’s debt sustainability, the balance of trade, the pressures of inflation and the depreciating value of the cedi have increased the heat in the economy.
The Single Spine Pay Policy (SSPP) has also been blamed for the challenges facing the economy because it is said that a major portion of the country’s revenue is used to pay the wages and salaries of public sector workers.
Last year in Ho, participants in a forum on the SSPP recommended a framework within which a freeze can be placed on the upward adjustment in the wages of public sector workers. Although organised labour disputed that claim by government officials, the authorities or managers of the public purse say if the economy must stay afloat, then public sector pay must be looked at properly.
The growing fiscal deficits are hurting the economy, but as has been warned by the International Monetary Fund (IMF), the country’s over-reliance on foreign capital will make the economy vulnerable to global financial shocks.
In his State of the Nation Address in February this year, President John Mahama expressed concerns about the “pettiness of politics” and called for a change that would see everyone playing his or her part in propelling the economy forward.
Mr Terkper did not hide the outlook of the economy when he said, “Risks relating to continuing commodity price volatility, global tightening and global financial conditions remained.”
However, some of the measures outlined in the policy statement to Parliament will come against a stone wall from the business world and organised labour.
The continuous policy on the reduction in subsidies on utilities and petroleum products will remain unpopular with the people, as that policy will increase the cost of living.
The proposal to place a freeze on public sector pay adjustment will not be a welcome news to workers, especially in the wake of upward adjustments in the prices of fuel and the utilities.
With the threat by transport operators to increase transport fares, Ghanaians should tighten their belts for the difficult times ahead.
The new measures outlined by the government were not quite explicit but it can be read that the government does not intend to employ people into some sectors, while attempts will be made to downsize or right-size labour in the public sector.
The days ahead will not be smooth, as more sacrifices will be required from all to put the economy back on a sound footing.
But the Daily Graphic calls on the government to demonstrate the right leadership in the crusade to get Ghanaians to bite the bullet now for a better tomorrow.
