The Association of Ghana Industries, AGI, has confirmed there would be more job losses in the coming months as a result of the downward review of the country’s growth targets for the year.
In his mid-year review and supplementary budget presentation yesterday, the Finance Minister, Seth Terkper announced a revision of the country’s overall real GDP growth from 3.9 percent to 3.5 among other economic variables.
AGI President, James Asare Agyei tells Joy Business, this would invariably lead to further job cuts in the private sector.
“Government is the biggest spender in any economy and ours is no exception. So if we actually review our growth target downwards, it means, the economy is shrinking and you cannot have a situation where the economy is not growing the way it should grow because it’s going to affect the private sector.
“If it affects the private sector, definitely we can only respond by reducing our capacity or production which invariably will also affect our staff strength. So what we need to do is to look at the key things that will stimulate growth for private sector to grow in production and also increase export which will be very key and important to any industrial development,” he said.
Meanwhile, the association has welcomed government’s shift in borrowing from the domestic market but says the public debt stock is still a threat to economic growth. “This will definitely bring some level of relief in crowding out the public sector. However, are we saying that borrowing in itself, especially excessive borrowing is not good for the country? What we need to do is to ensure that the macroeconomic stability is created in terms of access to capital; interest rate and more importantly stability of our currency which we think are key indicators for any private sector to trend,” he concluded.
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