The Ranking Member of Parliament’s Finance Committee, Dr Cassiel Ato Forson has shared some 10 economic forecasts which are likely to happen to the country in 2023.
According to him, 2023 will present one of the toughest years for the Ghanaian economy as there will be high unemployment, high inflation, and further cedi depreciation among others.
That’s not all, the Member of Parliament for the Ajumako-Enyan-Essiam MP also adds that the country will record one of the worst non-oil GDP growths saying the banking sector, local businesses and individuals will be adversely impacted by the haircuts on domestic bonds and Eurobonds.
The forecasts by Dr Ato Forson come on the back of a similar caution by the Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, that this year will be “tougher” than 2022.
We expect one-third of the world economy to be in recession. Even countries that are not in recession, it would feel like a recession for hundreds of millions of people,” Ms Georgieva said on the CBS news programme Face the Nation.
In a Facebook post, Dr Ato Forson shared the economic forecasts which included layoffs from the financial sector, and government foreign-financed projects, among others.
“Unemployment will worsen due to the freeze on employment, debt restructuring, poor business climate, and massive austerity. Expected layoffs from the financial sector due to the impact of the debt restructuring and expected layoffs from government foreign-financed projects.,” he further wrote on Tuesday, January 3.
The full post is reproduced as follows:
1.This year, Ghana’s economy will record one of the worst non-oil GDP growths due to the impact of debt restructuring and a plethora of extremely tough fiscal and monetary policies.
2.The haircut on domestic bonds and Eurobond is expected to adversely impact the health of the banking sector, local businesses, and individuals! Also, Bilateral debt restructuring will lead to the government’s foreign-financed projects being abandoned.
3.Unemployment will worsen due to the freeze on employment, debt restructuring, poor business climate, and massive austerity.
4.Ghana will default in the payment of interest and principal on domestic bonds, Eurobonds, and most of our bilateral loans in 2023. These will be compounded by the ff:
5.Expected layoffs from the financial sector due to the impact of the debt restructuring and expected layoffs from gov’t foreign-financed projects.
6.The complete reversal of discount on import values on goods and vehicles coupled with the introduction of the 2.5 % INCREASE IN VAT and other taxes on businesses will keep prices of goods and services high, and, in some cases, higher than current prices!
6.Also, the government’s policy of automatic adjustment of electricity tariffs will exacerbate the high cost of living in 2023
7.Inflation is expected to be above 30% for the most part of 2023.
8.Government’s gold for oil policy will not make any major impact on the price of petroleum products.
9.The cedi will inevitably depreciate further, from Jan to June. before a possible IMF board approval in Q2, 2023.