Economy downgrade: Akufo-Addo must apologise to Ghanaians – Lecturer

Professor Arthur Dissou Yarhands, a lecturer at the Akenten Appiah-Menka University of Skills Training and Entrepreneurial Development, has admonished President Akufo-Addo to apologise to Ghanaians over the mismanagement of the economy.

The lecturer who was speaking to Prince Minkah on Dwaboase on Power 97.9 FM on Monday, August 8 bemoaned the posturing of the managers of the economy as rating agencies keep downgrading the economy.

Last week, credit ratings agency, S&P Global Ratings downgraded Ghana’s debt further into speculative territory, lowering the country’s foreign and local currency sovereign ratings to junk.

The economy was rated from B-/B to CCC+/C with a negative outlook.

The recent ratings come after Moody’s downgraded Ghana to Caa1 with a stable outlook in February this year.

According to S&P, the negative outlook reflects “Ghana’s limited commercial financing options, and constrained external and fiscal buffers.”

S&P C downgrade means currently the country is vulnerable to nonpayment and dependent on favorable business, financial and economic conditions.

The rating agency however indicated that the COVID-19 pandemic and the conflict in Russia have magnified Ghana’s fiscal and external imbalances.

“Demand for foreign currency has been driven higher by several factors, including nonresident outflows from domestic government bond markets, dividend payments to foreign investors and higher costs for refined petroleum products” it said.

S&P adds that Ghana’s inability to access Eurobond markets has affected the economy.

The country’s debt stock is almost 80 per cent.

According to the Bank of Ghana, the country’s public debt has increased to 78.3 per cent of GDP (GH¢393.4 billion) at the end of June 2022, compared with 76.6 per cent of GDP (GH¢351.8 billion) at the end of December 2021.

Of the total debt stock, domestic debt was GH¢190.1 billion (37.8 percent of GDP), while the external debt was GH¢203.4 billion (40.5 per cent of GDP).

It is for this reason that Prof Yarhands Arthur believes the managers of the economy ought to apologise to the country’s electorates.

He indicated that Akufo-Addo in the run-up to the 2016 elections assured of managing the economy well unlike then President, John Mahama.