Economic analysts are casting doubt on the International Monetary Fund’s (IMF) prediction that Ghana’s inflation will drop to single digits by the end of 2025.
The IMF’s Economic Outlook Report forecasts an end-of-year inflation rate of 8 per cent for Ghana, in line with the government’s objectives outlined in the 2024 budget.
The Finance Minister’s budget statement anticipates a decrease in inflation from 29.4 per cent in 2023 to 15 per cent in 2024, with a further decline to 8 per cent starting from 2025. These projections are dependent on the government’s implementation of measures under the IMF program and the Bank of Ghana’s dedication to strict monetary policies.
However, some experts are skeptical about the feasibility of this forecast. Professor Lord Mensah from the University of Ghana Business School acknowledges the positive outlook presented by the IMF but raises concerns about the challenges associated with executing the necessary economic policies and structural reforms in Ghana’s economic landscape.
Professor James Atta Peprah, an Associate Professor of Economics at the University of Cape Coast, also expresses disagreement with the projection. He points to factors such as the high cost of doing business in Ghana and the potential impact of power outages (dumsor) on the rise in prices.
Peprah questions how inflation levels can decrease if the country continues to experience power outages until the end of the year.
