The government is being urged to use the 2022 budget statement and economic policy to introduce supply-side initiatives that will stimulate production.
According to economist Courage Martey, an improvement in domestic production will go a long way to mitigate the rising rate of inflation.
The year-on-year inflation rate for October 2021 hit 11 percent, according to the Ghana Statistical Service, the highest in the last 15 months.
In an interview with Citi Business News about his expectations ahead of the budget presentation on Wednesday, November 17, Mr Martey noted among other things that he will like to see policies that will ease the productivity constraints on the supply side of the economy.
“Once there is global disruption to supply we should be able to target those productions that can be executed within the shortest possible time to substitute for the shortfall in imports and be able to rely on domestic supply and bypass the global supply chains and mitigate the price pressures we are faced with.”
“So I want to see a budget that will stimulate production and create incentives for productivity growth. Fiscal consolidation doesn’t mean we shouldn’t spend. But we spend productively, we spend to reduce the supply-side constraints and ease the bottlenecks so that productivity can grow and output along with employment can increase. In the end, we would be substituting domestic production for external goods and services which is experiencing disruptions in the supply chain right now,” he added.