Opposition MP and Ranking Member of the Finance Committee in Ghana’s parliament has said the country should expect more economic difficulties this year, 2022.
Dr. Cassiel Ato Forson in a Facebook post on Sunday said: ‘folks we need to brace up for more hardship this year’.
The Ajumako/Enyan/Esiam lawmaker who advanced his argument in the six-bullet point post predicted that there would be “at least 30% increase in general goods while the Ghanaian cedi will hit seven Cedis to a dollar by the end of the year, 2022″.
He based his claim on the fact that, the cedi is currently trading at almost GH¢6.5 to $1.
According to the former Deputy Minister of Finance under the Mahama regime, fuel prices are “set to go up by 18 pesewas this week and more likely to go up again on account of a weak cedi”.
He noted that, there will be “multiplicity of taxes and levies to take effect by the end of January 2022”.
Dr. Forson further added that “interest rates are likely to go up again” while the government will be “borrowing heavily from the domestic market” since the Euro bond market is closed to Ghana for, at least, the first half of 2022.
Government fights back
But the government is fighting off the claim describing Dr. Forson’s assertion as not data-driven.
In a Facebook post a Deputy Minister of Finance, Dr. John Kumah called out his colleague MP saying: “It is unfathomable to think that a former Deputy Minister of Finance could be this pessimistic, speculative and propagandist on important issues concerning the economy of Ghana.”
While Mr. Forson expects economic difficulties in 2022, Mr. Kumah said “the economy is expected to grow at 4.9% even with ravaging COVID-19.”
“The government is turning around the economy back to the era of high growth before the COVID-19 pandemic came to our shores,” he added.
Dr. Forson predicted a 30% increase in the prices of general goods and further depreciation of the cedi as well as more increases in fuel prices.
Defending the performance of the cedi, Mr. Kumah said the cedi had depreciated by 3.63% compared to 3.93%, same time in 2020.
“This represents one of the lowest depreciation seen in the currency in the last decade. The Pound has only depreciated by 1.64% compared to 7 08% in 2020. The cedi as at end December 2021 had appreciated against the Euro by 4.48%.”
“Certainly, it is out of place to speculate about a currency with this sterling performance. Government is confident that the cedi will hold against the major trading currencies in 2022 given all the innovative currency management policies introduced, including the forward auction,” the Ejisu MP added.
See full post by Dr. John Kumah
SOURCE: DAILY MAIL GH with additional files from CNR and Facebook