The report that Ghana’s economic outlook for the year remains positive in spite of the challenges facing the country and the pledge by the Minister of Education that the $1.2 million World Bank grant for digital literacy will be channelled into resourcing deprived basic schools identified across the country are some of the leading stories in the Ghanaian press on Thursday.
The Graphic reports that Ghana’s economic outlook for the year remains positive in spite of the challenges facing the country.
The country’s projected Gross Domestic Product (GDP) growth at 5.3 per cent for the year and 5.1 per cent in 2023, which are both higher than the Africa average of 4.1 per cent.
The growth is expected to be spurred by the Ghana COVID-19 Alleviation and Revitalisation of Enterprises Support (GhanaCares) Programme.
This was contained in the Africa Economic Outlook (AEO) report released in Accra at the close of the African Development Bank (AfDB) meetings last week.
In spite of the positive projection which is also similar to the earlier ones made by the International Monetary Fund (IMF) and the World Bank during the Spring Meetings, the report noted that potential inflationary pressure existed due to increased energy and food prices associated with the impact of the Russia–Ukraine conflict.
Inflation is projected to surge to 15 per cent in 2022 before falling to 9.1 per cent in 2023.
“The Bank of Ghana is expected to adopt a tight monetary policy stance,” the report predicted.
The fiscal deficit is also projected to narrow further to 12.8 per cent of GDP in 2022 and to 10.3 per cent in 2023, spurred by revenue-enhancing reforms.
The current account deficit is also projected to narrow to 1.6 per cent of GDP in 2022 and 3.3 per cent in 2023, on increased exports.
The newspaper says that the Minister of Education, Dr Yaw Osei Adutwum, has said the $1.2 million World Bank grant for digital literacy will be channelled into resourcing deprived basic schools identified across the country.
He said the money would be used for the provision of furniture and teaching and learning materials to enhance the learning environment.
Dr Adutwum added that the Ministry of Education executed the teachers’ digital literacy project from its own resources as a condition precedent before the World Bank disbursed the grant, saying the replaced fund could be channelled into improving infrastructure in basic schools, including those described as “schools under trees”.
“I have been able to do the project with zero cost to the government. I’ve used existing resources, leveraged the government’s expenditure on the one-teacher, one-laptop initiative and used that platform to accomplish something that was not done before I took over,” he said.
Dr Adutwum was interacting with the Daily Graphic Editorial Conference, an assembly of editors and gatekeepers, chaired by the Editor of Graphic, Kobby Asmah, yesterday.
With the minister were the Technical Advisor for School Performance Improvement, Angela Affran, and the Head of Corporate Affairs, Kwesi Abankwah, both of the ministry.
It was the second time the minister had called to interact with the Editorial Team.
He also took time to visit G-Pak, the printing subsidiary of the Graphic Communications Group Ltd, which is printing some government textbooks.
The minister also visited the Managing Director of the GCGL, Ato Afful, where the former reiterated the fact that the ministry would partner the Junior Graphic to ensure that the newspaper was made available to all basic schools.
Dr Adutwum said the teachers’ digital literacy project was expected to train 40,000 teachers in digital literacy to trigger the disbursement of $1.2 million from the World Bank under the Ghana Accountability for Learning Outcomes Project (GALOP).
The Graphic also reports that the Monetary Policy Committee (MPC) of the Bank of Ghana has raised the benchmark Monetary Policy Rate (MPR) to 19 per cent, its highest level since 2017.
But even this does not tell the whole story; five years ago, the rate was coming down rapidly, whereas this time it is rising just as sharply.
The latest increase in the MPR, of 200 basis points, has come on the back of a 250 basis points hike after the immediate prior MPC meeting two months ago. This brings the cumulative increase over the last two meetings to 450 bps, from 14.5 per cent to 19 per cent.
This will not be the end of monetary tightening. Further hikes in the MPR are in the offing. The next MPC meeting is scheduled for late July and there are indications that the MPR will have to be raised to at least 20 per cent – possibly higher – when that happens.
Actually, this week’s increase could have been even bigger but the MPC has decided to go about the increase in a gradual fashion.
Besides, inflation is expected to rise further in May and over the coming couple of months as the latest 20 per cent increase in commercial transport fares and the impending hikes in electricity and water tariffs make their impacts.
However BoG Governor, Dr Ernest Addison, insisted that the central bank did not intend to “chase inflation” by trying to match the rising consumer inflation rate with commensurate increases in its benchmark interest rate; rather the MPC expected its interest rate hikes to pull inflation down towards the MPR.
But this will not happen soon. The BoG now projects that inflation will not fall back to within its target band of between six per cent and 10 per cent until sometime in 2023. In turn, this means that the elevated interest rate regime now imposed on the Ghanaian economy will have to be navigated for quite some time to come.
GIK/APA