Saturday, 21 October 2017

Invest massively in productive infrastructure -ISSER

By Gloria KYEREMEH, Accra
The Institute of Statistical Social and Economic Research (ISSER) is calling for massive investment in productive infrastructure as well as prioritizing non-traditional exports to ensure that medium growth targets are met.

In addition, ISSER said there was urgent need for prudent management of government resources and pursuit of increased efforts to mobilize revenue through an expanded tax based.
It suggested that government expenditure should be controlled over the short-to-medium term.
These recommendations were contained in the State of the Ghanaian Economy Report launched by ISSER in Accra yesterday.
Weak infrastructure
ISSER pointed out that the week infrastructural systems, especially in the energy and transportation sectors, and ineffective public administration structures would require significant improvements in order not to undermine efforts to make investing in Ghana a worthwhile venture.
Improvement in power supply
Touching on issues under the services sector, ISSER said improvement in power supply would see linkages between industry and services improve industry’s contribution to national output and also increase agriculture production and provision of services.
The report said the projected growth is expected to be driven by strong performances in the information and communication, trade, repair of vehicles as well as household goods subsectors.
With the creation of aviation and railways development ministries, ISSER says go government is expected to facilitate transportation and ensure productivity in those sectors.
Fiscal Developments
According to ISSER, in 2016 total interest payments which comprise of payments on domestic and external debt amounted to GH¢10,770 million which was 2.7 per cent higher than budgeted.
Capital expenditure
It also stated that total capital expenditure in 2016 amounted to GH¢7,678.1 million which was also 20.1 percent higher than the target of GH¢6,393.0 million.
The higher outturn according to ISSER was driven partly by higher foreign-financed expenditure which was on account of higher project loan disbursements than anticipated.
In addition, it said public debt sustainability continues to pose a threat to Ghana’s economic stability and there was the need to curb the relentless rise of debt.
ISSER, therefore, suggested that achieving 2017 targets would require fiscal discipline and it would be critical for not only economic growth, but also for future debt sustainability.
Specific Policies to be pursued
ISSER suggested specific policies that should be pursued by government to improve the economy.
Improving revenue
These include broadening the tax base through the full implementation of the National Identification Scheme and the National Digital Address System which ISSER believes would help improve the formalization of the economy and broaden the tax base.
Wage arrears
Others were improving the wage arrears situation and debt management, implementing these polices according to ISSER would be critical to Ghana’s economic growth.
ISSER noted that Ghana’s dominant agricultural activities- fruits and nuts, and cocoa contribute positively to national pro-poor growth.
It said a more balanced portfolio of value chains would not only enhance agriculture’s future contribution to poverty reduction and economic growth, but will also promote faster rural transformation and dietary diversification, both of which are needed to create job opportunities and improve nutrition outcomes over the long term.

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