Minister of State at the Finance Ministry, Charles Adu Boahen has said the impressions he gets from meetings he has been attending is that all countries, whether in Europe or Africa or Asia, are facing similar economic challenges – high inflation, food insecurity, currency depreciation, rising youth unemployment.
In his view, it doesn’t appear that there is going to be any reprieve next year.
To that end, he has asked all to continue to tighten their belts.
Addressing a press conference in Washington DC, United States of America, he said “The general consensus across all the meetings I have attended is that we certainly are in the midst of global crisis. There is a saying that nowhere cool.
“I think coming here today, this week and the past week has really confirmed that we are not the only ones who have been going through very challenging times. Whichever country you engage the Ministers, whether being the West or in Africa or in Asia, their problems are similar – high inflationary pressures, currency depreciation, food insecurity, rising youth unemployment. It has really brought to the fore the fact that we need some unique solutions for these unique set of problems across board.
“There is also still quite a lot of uncertainty about the Russia-Ukrainian war and how it is going to end. It certainly seems that the understanding is that it is going to go into 2023, there seems to be the perception that 2023 is going to be tougher than 2022. If you look all at the forecasts you can see revisions have been made. These revisions have all been downwards, not upwards.
“The only thing that it may seem to have tapered off in the forecasts is, maybe, inflationary pressures but that of course will be based on the fact that this year has been so high, coming of a high base , it is unlikely that we will see the same high levels going into next year. Crude oil forecasts still seem to be in the high, double digits to triple digits. So essentially, from my impressions from meetings I have attended so far, it doesn’t look like there is going to be any reprieve next year and so we need to continue to tighten our belts and look at some serious fiscal consolidations in the budget for 2023.”
Information Minister Kojo Oppong Nkrumah has also said that the International Monetary Fund (IMF) forecasts about global and African economies for 2022 and 2023 are worrying.
He urged his colleagues in economic discourse to interrogate these forecasts and their causes.
He also asked analysts to examine the adequacy of responses by governments and the proposed alternatives.
“The forecasts about the global and African economies 2023 are very worrying. I encourage my colleagues in economic discourse to interrogate these forecasts and their causes. Additionally we should examine the adequacy of responses by govts and the proposed alternatives,” the Ofaose Ayirebi lawmaker tweeted.
The IMF has said growth in sub-Saharan Africa will slow sharply to 3.6% in 2022 and remain low at 3.7% in 2023.
The Fund further indicated that financial stability risks have increased amid the highest inflation in decades and the ongoing spillovers from Russia’s war in Ukraine to European and global energy markets.
Amid poor market liquidity, there is a risk that a sudden, disorderly tightening in financial conditions may interact with preexisting vulnerabilities.
In emerging markets, rising rates, weak fundamentals, and large outflows have pushed up borrowing costs, particularly for frontier economies, with a heightened risk of additional defaults.
In China, the property downturn has deepened as sharp declines in home sales have exacerbated pressures on developers, with heightened risks of spillovers to the financial sector.
