Ghana’s output expansion largely driven by labour, capital rather than innovation – Opoku-Afari

He added that petroleum revenues earmarked for priority infrastructure were also often diverted toward recurrent outlays and debt service, noting that as fiscal pressures intensified, higher government borrowing increasingly crowded out private-sector credit and weighed on investment and potential growth.

He made the expression that the crowding-out channel became increasingly evident over time with private-sector credit growth slowed, while elevated domestic yields raised the cost of capital and constrained investment.

According to him, this is consistent with a debt-overhang dynamic in which persistent fiscal imbalances and rising public financing needs dampen private-sector activity and weaken medium-term growth prospects.