‘Inflation of 5.2% means nothing’ to someone spending 12 hours travelling to Kumasi – Bokpin

Economics Professor Godfred Alufar Bokpin says inflation of 5.2% means little to someone spending up to 12 hours travelling to Kumasi, arguing that improving economic indicators must translate into better living conditions.

Speaking on Joy News’ PM Express on Tuesday, he acknowledged government’s progress in stabilising the economy. But he warned that its heavy reliance on spending cuts was delaying the benefits for Ghanaians.

“If somebody is spending nine to 12 hours to travel from here to Kumasi, inflation of 5.2% means nothing to that person.”

He also pointed to the difficulties commuters face on the Accra-Tema Motorway. For people confronting such challenges, he said, lower inflation can be difficult to appreciate.

“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.”

His comments come ahead of the 2027 Budget, scheduled for presentation on Thursday, November 12.

Finance Minister Dr Cassiel Ato Forson is expected to outline government’s New Economy programme, a four-year plan focused on productive investment and economic transformation.

The Minority in Parliament has questioned the programme’s financing and demanded accountability for existing flagship initiatives. It has also challenged the gap between falling inflation and household living costs.

Prof Bokpin said government’s approach had helped cool the economy by reducing demand. However, it had not sufficiently expanded the country’s constrained capacity to produce.

“If you choose that approach, you will get the result, but the impact will not be felt by Ghanaians.”

He argued that a country with major infrastructure gaps needs spending to support growth.

“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.”

Despite those concerns, Prof Bokpin said government had broadly delivered on its stated objective of restoring stability during its first two years.

He cited falling inflation and interest rates, alongside the cedi’s relative resilience despite renewed pressure.

“To that extent, and to the extent that that is what we are set out to achieve in the first two years of the administration, I would say they've done quite well in restoring macroeconomic stability.”

The next phase, he indicated, would move from stabilisation towards economic transformation.