Economist Prof. John Gatsi has advised the incoming NDC administration to prioritise addressing food inflation and avoid being misled by claims of economic recovery to pre-COVID levels.

Speaking after the recently held December 7, 2024, general elections, Prof. Gatsi highlighted the discrepancy between political narratives and the warnings from government statisticians, who caution that the positive growth figures are not translating into tangible benefits for citizens.

“However, this is at odds with warnings from government statisticians, who caution that unless growth numbers are sustained, their impact on citizens - who are the real owners of the economy - will remain negligible,” he said.

Despite positive growth numbers from the first to the third quarters of 2024, Prof. Gatsi pointed out that this growth is not inclusive and lacks job creation.

He warned that the economic expansion driven by the mining sector, including illegal mining, is unsustainable.

Additionally, key sectors such as oil and gas, cocoa, water, and sewerage are experiencing negative growth, with the electricity sector growing by less than 1%.

“Economic expansion led by the mining sector, including galamsey (illegal mining), is unsustainable and could soon have undesirable consequences.

“The oil and gas sector is recording negative outcomes, the cocoa sector has seen five consecutive quarters of negative growth, and water and sewerage also show negative growth, with the electricity sector growing by less than 1%,” he pointed out.

Prof. Gatsi emphasised the need for the new administration to understand the underlying issues behind the reported growth and to focus on immediate challenges such as food inflation, which reflects broader cost-of-living issues.

He also stressed the importance of addressing the country's debt obligations and supporting viable business ideas to combat high unemployment and prohibitive interest rates.

“The new administration must understand how the economy posted positive growth during the election year, despite marginal or negative performance in key sub-sectors.

“Instead of assuming the economy has recovered, we must acknowledge that unemployment has surged, and countless Ghanaians with viable business ideas lack the support needed to realize their potential,” he said.

He urged the new government to leverage goodwill to attract support for tackling food inflation, rebuilding domestic capital markets, restoring confidence, and demonstrating fiscal prudence.

“The new government must address the problems created by the outgoing administration. These issues should be flagged for immediate action while leveraging goodwill to attract support for tackling food inflation, rebuilding domestic capital markets, restoring confidence, and demonstrating fiscal prudence,” he stated.

Prof. Gatsi concluded that while the situation is complex, it is not insurmountable with determined and strategic efforts.

ID/MA

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