Ghana's Economy On Track -PEF

The Private Enterprise Foundation (PEF) of Ghana says that the Economy performed creditably within the first six months of the year. It has however expressed fears about the capability of the government to sustain the relative stability of the economy in view of the rising prices of crude oil and the upward adjustment of utilities which are putting pressure on the cedi.

This was made known by the Technical Service Director of PEF, Mr. Jesse Clottey, at a media review meeting wit members of the foundation in Accra. The one-day seminar brought stakeholders from the construction, manufacturing, financial and trading sector of the economy.

Mr. Clottey said, the private sector believes that there are pressures on the economy that could undermine the downward trend of inflation. He mentioned the speculation that government has over spent in anticipation of more inflows during the second half of the year. Mr. Clottey said the private sector will monitor the situation closely and make its findings known to the government in the course of the year. He said it is the expectation of the private sector to have an enabling environment to facilitate its growth.

This he said will involve among other things, the creation of micro-economic stability, adequate flow of credit, an efficient public service and an enabling legal framework. The technical director said inadequate credit to the private sector is hampering its effective participation in the economy. The foundation expressed fears that should donor inflows fall below expectation during the second half of the year government will be compelled to borrow more resources from the financial sector.

Mr. Clottey advised government to maintain an effective expenditure in order to avoid a situation in which the private sector will be crowned out as a result of a large public sector borrowing. The second half performance of the economy could be worsen or be better depending on what happens to donor inflows, the impact of price hikes in utilities as well as future political development in the Middle East.

Discussants at the meeting were unanimous that government needs to ensure the relative and economic by pursuing prudent financial management of the economy. The National President of the Association of Building and Civil Contractors of Ghana, Mr. Samuel Obeng, called on government ton accelarate the payment of arrears due to civil and building contracts which has accumulated over the past. He said called also on government to stop giving priority attention to foreign contractors does not benefit from such facilities.