Prof Godfred Alufar Bokpin, a Senior Finance Lecturer at the University of Ghana Business School, has said that previous Ghanaian administrations have all failed to control inflation.
He said that, despite several structural changes, the economy's management has not improved significantly since Ghana's independence.
"We have never been able to control inflation since we took power in this nation, both in terms of politics and fiscal policy." Inflation was 0.98 percent in 1964, but by the end of the year, it had risen to 26.4 percent.
"And we're almost at the point where we'd call Ghana a failed state," he added.
He mentioned this on JoyNews' Newsfile on Saturday during a debate about inflation. Recent numbers suggest that inflation in the country has increased, necessitating the conversation.
According to current estimates from the Ghana Statistical Service, inflation in Ghana increased to 27.6 percent from 23.6 percent in April 2022. (GSS).
The GSS attributed this to rising transportation and food prices.
According to Professor Kobina Annim, the Government Statistician, inflation rates for transportation (39.0 percent), household equipment and maintenance (33.8 percent), housing, water, gas, and electricity (32.3 percent), and food and non-alcoholic beverages (30.1.6 percent) were all higher than the national average (27.6 percent ).
12 of the 13 divisions had inflation rates greater than the rolling average in May 2022. Also, based on year-over-year numbers, grapes, which are imported, witnessed a 100.8 percent increase, followed by fuel, which is also imported, at 81.1 percent.
Inflation in firewood was likewise 73.7 percent year over year.
Prof. Bokpin had previously requested that the government use a fiscal policy strategy to combat inflation in the country.
He believes that monetary policy has shown to be ineffective.
On Thursday, June 9, the Professor commented on the country's current inflation rate on Super Morning Show, saying, "If you look at the disparity between inflation and the policy rate and the Treasury bill rate, it tells you there's a lot more work to be done and we can't look to monetary policy because the problem is structural."
"Monetary policy is confined in terms of how we can use it effectively to manage inflation and engineer growth," he stated.
As a result, according to the Professor, we cannot rely on monetary policy to solve the problem.
He emphasized, "We must transfer our attention to the fiscal side so that the fiscal side responds correctly with the discipline that it demands."
"There's a limit to how far you can use monetary policy to bring down inflation and then engineer growth if the source of inflation is mostly fiscal," he added.
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