Why Economic Growth Don’t Reflect In Pockets …Dr. Stephen Amoah Explains, Urges Citizens To Pay Tax

Deputy Minister of Trade and Industry, Dr. Stephen Amoah, has done an economic analysis on why when governments tout the growth of economic indicators, the usual refrain that greets it is that people do not feel it in their pockets.

According to the Investment banker and Member of Parliament (MP) for Nhyiaeso constituency in the Ashanti region, “Industrial or market economy of most developing economies, including Ghana, is predominantly the defensive type. Ladies and gentlemen, when I say the defensive type, their systematic risk index is less than one (1), and what it means is that when the economy of our country moves 10% or ten steps, the market generally in our country does not move along with it. It could move maybe 1% or doesn’t move at all.”

The Nhyiaeso MP disclosed that, that is one of the major reasons even though economic indicators may show growth, people complain about not feeling its impacts in their pockets.

Sticker, as the deputy minister is fondly referred to disclose this at the second edition of the Financial Economics Seminar-2023, a yearly economic seminar which is gaining root as the most sought-after forum to discuss macroeconomic, International finance and financial markets issues, held at the UPSA Auditorium, in Accra last Wednesday.

It is also underpinned, the Dr Amoah said, by the fact that SMEs occupy about 90% of our market establishment and employs about 80% as against even the global average of 67%.

The member of the Finance Committee in Parliament noted that one of the reasons there is mostly capital shortage is that Banks are comfortable dealing with government because of Gov’t penchant to borrow from the local market at higher interest rates like private entities do, which, he argued makes nonsense of one of the fundamental principle of finance, that the higher the rate, the higher the cost of return.

He also said, for instance, that successive governments keep increasing policy or interest rates with the aim of reducing inflation but that unduly affects trade and industry such that where inflation is given rise to by cost-push then one must be cautious.

Dr Stephen Amoah intoned that “So far as we don’t pay realist, so far as we don’t work on the leakages in out tax system, so far as we don’t include other stakeholders in paying taxes in Ghana we’ll continues to borrow,” the minister said revealing that about only about 2miilion out of the about thirsty-eight million Ghanaians pay taxes.”

He however urged communities to help Government when it comes to decisions bothering on taxes so that government development programmes could come to life.

For her part, Proff. Atinuke OlusolaAdebanji, a professor of statistics at Kwame Nkrumah University of Science and Technology, emphasised the importance of data and recommended for the institution of data quality management to that data is managed well.

This year’s Financial Economics Seminar themed “Impact of socio-economic policies on trade and industries in developing economies” was chaired by the Ga Mantse, King TackieTeikoTsuru II and the discussions centred on the impact of socio-economic policies on trade and industries in developing economies.