The cedi’s rate of depreciation is “scary”, and until government is able to get the situation under control the talks about fiscal consolidation will not see fulfillment, Prof. Eric Osei-Assibey, senior lecturer in the Department of Economics, University of Ghana, has warned.
Speaking at a budget review forum organised by the Chartered Institute of Supply Chain Management (CISCM) for its professionals in Accra, he indicated that the cedi–depreciation could block the realisation of key targets in the 2020 budget.
He said: “The realisation of macroeconomic targets will be hinged largely on the ability of government to control depreciation of the cedi.
“That will have ripple-effects on all the other indicators because a depreciating cedi could drive up inflation, which will in turn lead to high cost of borrowing and a rise in debt stock. All of these are a threat to keeping fiscal deficit within target.”
The economist was however upbeat about the strategic pillars that government intends to rest on to grow the economy; which includes intensifying the drive for FDIs; intensive investment in development infrastructure; and creating a competitive business environment through access to affordable credit.
“There is a very substantial savings gap that tends to constrain our ability to invest in critical developmental projects and be able to close that space; there is a need to be able to attract more FDIs that will drive investments to critical sectors of the economy.
“Government’s resolve to improve the financial ecosystem to ensure access to affordable and long-term credit is also very commendable,” he noted.
The one-day forum, on the theme ‘The impact of effective integrated supply chain management on 2020 Republic of Ghana’s budget outcomes’, convened supply chain practitioners and policymakers to proffer practical inputs toward attainment of the budget targets by leveraging seamless supply chain management.
Supply Chain Governance Expert and Board Chairman of the Public Procurement Authority (PPA), Prof. Douglas Boateng, in his remarks tasked supply chain professionals to think along the lines of value addition, as it will be the backbone for a successful Ghana beyond Aid.
He noted: “For instance, with the 1D1F and the single African market, the ability to move produce or goods across markets to compete favourably – as well as the readiness of Ghanaians to buy and consume local – must all be factored into planning with strong supply chain thinking.
Supply chain management is seamlessly working together for long-term economic development.”