With misfortunes of the early 2020s finding their way into 2023, it is not uncommon for people to predict continued economic hardship in the new year of 2024.
Two weeks into the new year and the Gaza Strip war has already escalated to epic proportions. Thus, it is not strange to expect doom on the minds of observers.
Commercial sea-going vessels have been the subject of fatal attacks by Yemeni armed rebels along the Red Sea route, causing severe apprehension among businesspeople and ordinary consumers. The economic effect in Ghana is yet to be quantified; but if experts take a cue from similar events in recent years, we should not expect a pleasant song.
Nonetheless, trade expert and West Africa Director for CUTS International, Accra, Appiah Kusi Adomako has expressed some optimism for 2024 as far as the economic outlook of Ghana is concerned, in light of global happenings.
Reviewing the year 2023 and prospecting for 2024 on the Eye on Port TV programme, Mr. Adomako predicted relative stability for the cedi in the new year.
He said with the United States Federal Reserve reportedly likely to cut interest rates, investors will redirect funds to emerging economies like Ghana. This, according to him, will have a positive effect on the cedi’s value.
“In 2022, the cedi was stable until the US decided to increase its interest rates; so, people were moving all their investments from emerging economies and Ghana was suffering a lot, because every day investors were withdrawing their investments from Ghana. And whenever they withdraw their investment and convert to dollars, there’s a lot of pressure on the cedi. This year, we expect government to reduce the interest rate; and most likely we are going to have a lot of dollars coming into emerging economies, and Ghana could benefit.”
He added that Ghana is meeting its external creditors for an Extended Credit Facility programme, “and we hope that once they are able to agree on a good deal for us, we will end up getting the US$600million. In fact, the president said we hope to get US$1.6million by end of May”.
However, all won’t be rosy in 2024 according to the West Africa Director-CUTS International Accra, who calls for a sense of caution and preparation in 2024.
He says while it is fair to acknowledge the effects of global events like COVID-19, the war in Ukraine among others on the local economy, government is not absolved from blame.
Mr. Adomako urged government to strategically introduce policies such as import restrictions in proportion to the local capacity to produce.
He said proper planning and accountability can have a mitigating effect on the impacts from global shocks on the economy.
According to Mr. Adomako, Russia has shown no sign of withdrawing from the war in Ukraine, and the potential regionalisation of the Israeli-Palestine war may require economic resilience from governments around the world.
He urged government to be circumspect in its expenditure during 2024, especially as the country prepares to head to the polls in December.
He said government must abide by the Fiscal Responsibility Act in order not to return the state into an economic quagmire in 2024.
