By: Nathaniel Nartey
Director of the Institute of Statistical Social and Economic Research, ISSER, at the University of Ghana, Professor Peter Quartey has advised politicians, social commentators and Ghanaians, in general, to be circumspect in their choice of words in relation to Ghana’s economy which has the tendency to derail investor confidence.
He says descriptions of Ghana’s economy as ‘broke’, or in crisis does not paint the right image for the country because Ghana is not broke. In an interview with GBC News, Professor Quartey gave a number of indicators that depict a broke economy which includes unsustainable debt levels, low income or GDP growth, public sector wage arrears and high inflation among others. He told Nathaniel Nartey that ”Ghana’s economy in 1983 is a typical example of an economy in crisis and not the present day economy”, he posited.
”There are a few characteristics or traits in an economy that is ‘broke ‘or in crises, you will see low income of GDP growth, hyper inflation sometimes above 100%, huge budget deficits as well as significant exchange rate depreciations with a thriving black market. You will also find that Public Sector Wages are in arrears, sometimes 3 months and above and there are labour agitations now and then, unsustainable debt levels with debt servicing challenges. With all the points raised, if we compare with our current economic situation can we confidently say that Ghana’s economy is ‘broke’? I would say no”.
On the issue of unsustainable debt levels as indicated earlier, Prof Quartey said, ”Ghana’s ability to settle its debt means her economy is not ‘broke’ or in crisis.”
”The unsustainable debt level is just one indicator and even with that, we have not crossed the threshold and your ability to service your debt is very critical and I don’t think we have heard that Ghana is unable to service its debt”.
