Dr. Michael Ayamga-Adongo, head of the department of applied economics at the University of Development Studies (UDS), revealed that there were signs that the country’s economy had experienced a slowdown due to excessive borrowing long before the emergence of COVID-19.
He said that although COVID-19 had impacted the economy, given the lockdown, border closures, reduced trade, among others, the economy was already plagued by excessive borrowing, spending. high public expenditures, which exposed it to economic shocks.
Economist Dr Ayanga-Adongo pointed out that “the growing debt owed to electricity producers in the energy sector, estimated at more than $3 billion, and an additional $3 billion in obligations to pay customers insolvent banks as part of the financial sector clean-up, were early”. signs of a cracking economy.
He was speaking to the Ghana News Agency in reaction to the State of the Nation (SONA) address delivered by President Nana Akufo-Addo on Wednesday, March 30.
Dr Ayamga-Adongo said the President must paint a true picture of the situation so that the citizens can appreciate the challenges facing the country.
He reiterated that the President could have taken the opportunity to tell citizens the reality of the economy to build consensus to rally them behind the fundamental goals of saving the economy.
He described the country as bankrupt and said he could not do any meaningful project without borrowing, adding “Nobody wants to lend to us and nobody is interested in what we offer in the capital market.”
Dr Ayamga-Adongo recommended the urgent need for the government to raise funds to finance its program, saying that this could only be done by uniting the citizens.
He lamented the president’s posture in dealing with matters of national concern and said the president should avoid campaign talks at times like these, stressing that “the president behaves as if he is campaigning. election and that does not help matters”.
President Akufo-Addo presented the SONA on Wednesday, where he discussed the country’s overall performance and reviewed in depth the economic, political and social situation for the year under review.