A professor of Finance and Economics at the University of Ghana has criticised government's approach to fiscal discipline, warning that Ghana's economic problems require decisive spending, not celebration of restraint.
Charles Godfred Ackah, speaking on JoyNews' PM Express Business Edition on Thursday, questioned the logic behind what government touts as prudent financial management. "Well, fiscal discipline is good if it's defined as a way of reducing waste of resources, corruption, and then improving on expense efficiency, then it's good," he said. "But if fiscal discipline means that you should run a budget surplus as a developing country that has so much waste, so much idle resources, manpower, resources wasting… then no." According to him, the nation cannot afford to boast about spending cuts when critical sectors are starved of funds and infrastructure remains poor across the country. "People have finished university in five years, six years not getting jobs, nurses are sitting at home, teachers are still home, universities cannot employ lecturers when there are so many students, and roads are terrible from here to Kumasi and all over the country," he pointed out. "You need to invest in infrastructure.
You need to invest in the productive capacity of the country." Prof.
Ackah insists the conversation should not be about achieving a budget surplus at all costs, but about channelling spending into projects that directly address the country's economic stagnation. "If that means you must run a reasonable budget deficit and… this budget deficit is going into investing… even in the private sector, or have households and individuals… to invest in real estate, to invest in businesses, then that's not imprudence," he said.
