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Friday, September 30, 2022

Tackling inflation and cedi depreciation: There is something more to it than merely increasing the policy rate – Twum Akwaboah

The Chief Executive Ofiicer of Association of Ghana Industries (AGI), Seth Twum Akwaboah says the Bank of Ghana needs to consider other measures to curb the current rising inflation and cedi depreciation.

According to him, although the BOG has put a series of interventions in place they are not yielding the desired results.

“If you look at the past three or so policy rate review or the Monetary Policy Committee meetings, they are always reviewing and revising the policy rate upwards. So I would have expected that by now inflation would have come down drastically. But it’s not happening, so it means that there is something more to it than merely increasing the policy rate”, he posited.

Speaking on PM Express on Tuesday, he indicated that the inability of the review of MPC rate to address the situation gives an indication that the country is really in dire straits.

“I think in the past, those measures have helped to stabilize the situation. It has helped to halt the inflation and all that but this time around, we don’t know what is wrong. It looks like our fundamentals are so weak that even though the Bank of Ghana is introducing all these measures, we are not seeing the positive effects that we expect.”

He went on to say that these measures to control Ghana’s rising inflation have not been particularly positive for businesses in the country

“Bank of Ghana in their view, may think this is the best policy, for us at the business end, we look at the result. What is the outcome of those policies that you are putting in place? For me, the outcome has not been that positive, it’s not significantly changed the situation. We still have inflation going up.”

He noted that the failure of the BoG’s measures to stabilize the economy is indicative of the fact that more needs to be done to solve the current crisis.

“For now it’s very difficult to predict the situation. No one can tell which particular measure will be the game changer. A combination of things must happen, so we need to monitor the situation and see. But I think what we are finding ourselves in now, it’s quite a challenging one”, he stressed.

Ghana’s economic situation has not been the best in recent times.

With the hike in fuel prices and transportation fares as well as the depreciation of the currency, many Ghanaians are complaining about their dire financial needs.

Economists have also predicted doom for the economy should government fail to salvage things with urgency.

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