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World Bank lauds gov’t efforts to stabilize economy

Oct. 20, 2015, 8:35 a.m.

World Bank President Dr. Jim Yong Kim is confident measures being implemented by government to forestall the precipitous fall of the economy will yield success.

But despite this optimism, Dr. Kim is warning that there will be some tough times ahead for the country before economic stability is achieved.

Speaking in an exclusive interview with Joy Business’ George Wiafe during his recent visit to Ghana, Dr. Kim said robust economic reforms would have to be implemented by managers of the economy before headways in economic stability can be made.

He said government’s efforts at decreasing fiscal deficit, improve structural reforms and maintain spending on health and education are steps in the right direction.

“But there are challenges, inflation still remain high,” he observes.

He said robust economic reforms would be the country’s best bet to achieving economic stability by next year.

“I think overall, what is really going to be important, is for Ghanaians to commit to increased productivity in all sectors of the economy, for example every single budget expenditure by the government should be examined,” he adds.

He said government must also take a critical look at that the performance of the public sector and ask whether it is performing adequately, noting this “would be a hard question that Ghana would have to ask”.

“Another issue is skills. Do the people of Ghana have the skills and education required to take on the next state of economic growth?” he quizzed.

He also urged the “young people of to think about the kinds of skills they need to compete in the global economy”.

Although some economists remain sceptical about the ability of the economy to recover anytime soon, Dr Kim said recovery is possible if managers of the economy and Ghanaians are committed to making that happen.

He said the World Bank would always assist the country in moves towards economic recovery.

The World Bank recently led Ghana to the bond market to raise a 15-year loan that the bank maintains is low cost, although some analysts believe is high.

Analysts say the $108 million dollars Ghana will be paying every year on the $1 billion dollar bond is too high.

The almost 11% interest that the country would be paying on the bond has caused analysts to question the relevance of the support from the World Bank through a credit guarantee.

However, Dr. Kim thinks otherwise.

He insists the 15-year bond is a tactical approach to unshackle the country from rising debts.


Disclaimer: The views expressed in this news report do not necessarily reflect the position of the National Development Planning Commission (NDPC)