27/07/2025
On metro TV yesterday, Dr. Eric Boachie Yiadom, a lecturer at UPSA, explained fiscal consolidation.
At the heart of fiscal consolidation are two things: cut budget deficit and reduce public debt.
1. You cannot do fiscal consolidation in 6 months if the base has not been set.
2. Govt now has minimal debt obligations because debt restructuring has given him relief.
3. Our debt levels of 61.8% in Dec 2024 fell below the ECOWAS criteria of 70% setting the base for debt sustainability.
4. Strong external reserves built over years have given the government flexibility to shift dollars to the FX market, leading to cedi appreciating about 40%.
5. The cedi appreciation technically reduces external debt, leading to current debt levels below 50%.
6. Expenditure rationalisation as part of fiscal consolidation was made possible by the previous government. The government is now focusing on projects that are 70% completed. Who did the 70% of the work?
7. If you're asked to put the icing on the cake, be thankful to the one who set it up
