Professor Godfred Bokpin has urged the John Mahama government to spend to stimulate growth to put money in the pockets of Ghanaians.
He warned that the government’s cuts to expenditure are delaying the benefits of economic stability for Ghanaians.
He acknowledged improvements in key economic indicators but added that Ghana’s infrastructure deficit required investment to remove barriers to growth.
Speaking on JoyNews’ PM Express on Tuesday, Prof Bokpin stated, “We need government to spend to stimulate growth”.
Prof Bokpin noted that the government’s stabilisation approach had relied heavily on spending cuts in both 2025 and 2026, arguing that approach carried consequences for households and businesses.
“So, for a country that is saddled with a huge infrastructure deficit, imposing restrictions on the growth drivers of the economy, such a country cannot celebrate extensive austerity expenditure cuts.”
Prof Bokpin explained that cutting expenditure could lower inflation by weakening demand.
He, however, disclosed that it would not necessarily expand the economy’s limited capacity to produce.
Prof Bokpin added, “You are shrinking aggregate demand as a way of also bringing inflation down, rather than expanding the economy’s severe or restricted supply capacity.”
He further argued that improved economic figures may offer little comfort to people facing poor roads and lengthy journeys.
“If somebody is spending nine to 12 hours to travel from here to Kumasi, inflation of 5.2% means nothing to that person.”
“It’s simply because the approach we have adopted in restoring macroeconomic stability is going to take a while to reflect in the lives of Ghanaians.”
Prof Bokpin, however, credited the Mahama government with making progress towards its stated two-year stabilisation objective.
“I would say they’ve done quite well in restoring macroeconomic stability,” he added.
Prof Bokpin added that the government’s proposed New Economy reflected its intention to move from stabilisation towards economic transformation.
Prof Bokpin’s call comes ahead of Finance Minister Dr Cassiel Ato Forson’s presentation of the 2027 Budget on Thursday, November 12, with the government planning to unveil a four-year New Economy programme focused on investment in productive sectors.
Meanwhile, Dr Cassiel Ato Forson, the Minister of Finance, has assured Ghanaians that the government will not borrow loans to finance its proposed New Economy Programme.
The Finance Minister disclosed that the initiative will be funded through domestic revenue and savings from fiscal consolidation.
According to Ato Forson, the government plans to commit 1.5 per cent of Gross Domestic Product (GDP) annually between 2027 and 2030 to the programme without adding to the country’s public debt.
He made this known while responding to concerns about the source of funding for the programme during an interactive engagement with students and members of the university community at the Kwame Nkrumah University of Science and Technology (KNUST).
Ato Forson detailed that the funding would come from two main sources: an allocation of 0.5 per cent of GDP from government revenue and a reduction in the primary surplus target from 1.5 per cent to 0.5 per cent of GDP.
He revealed that the two sources would create the fiscal space needed to invest in the programme, with the total allocation potentially reaching at least US$13 billion over four years.
