Establishing a Debt Ceiling: A Necessity for Ghana’s Economic Stability
Dr. Priscilla Twumasi Baffour advocates for a debt ceiling in Ghana to prevent excessive borrowing and ensure economic stability. She stresses the need for fiscal discipline, proper debt management, and legislative measures to enhance accountability. While there are signs of progress in the 2025 Budget, effective implementation is essential for achieving long-term goals.
Dr. Priscilla Twumasi Baffour, a lecturer at the University of Ghana Business School, has advocated for the establishment of a debt ceiling to mitigate excessive government borrowing in Ghana. She emphasizes that the country’s economic stability relies significantly on stricter fiscal controls. Speaking during an interview on JoyNews on March 15, 2025, Dr. Twumasi Baffour noted encouraging signs of economic recovery, though these developments are accompanied by ongoing debt restructuring efforts.
Dr. Twumasi Baffour highlighted the necessity of effectively managing Ghana’s debt to maintain macroeconomic stability, which is crucial for fostering business growth and enhancing consumer confidence. At the National Economic Dialogue, she reported that a recommendation was made to establish a debt ceiling that would restrict government borrowing beyond a predetermined threshold.
Furthermore, she underscored the need for stability in key economic indicators to rebuild public trust. Dr. Twumasi Baffour asserted, “Macroeconomic stability is the foundation of everything. If businesses are to thrive and consumer confidence is to rise, people must retain value in their incomes.” This, she explained, necessitates controlling inflation and stabilizing the currency while also lowering interest rates through appropriate measures.
Additionally, Dr. Twumasi Baffour expressed support for Finance Minister Dr. Cassiel Ato Forson’s plan to review the Fiscal Responsibility Act, viewing it as a positive advancement. However, she believes that fiscal responsibility extends beyond mere policy announcements, advocating for legal measures that ensure the Fiscal Responsibility Committee functions without presidential discretion, thereby enhancing accountability in executive spending.
She acknowledged that aspects of her proposals manifest in the 2025 Budget but cautioned that their efficacy hinges on effective implementation. “These are medium to long-term plans, and we cannot achieve everything within a year,” she noted. Nonetheless, she reassured that signs of progress are evident in the budget, indicating that this initiative is not merely a theoretical discussion.
In summary, Dr. Priscilla Twumasi Baffour’s call for a debt ceiling in Ghana is rooted in a desire to establish fiscal discipline and economic stability. The importance of managing the nation’s debt and reinforcing macroeconomic stability for business growth and consumer confidence were emphasized. While positive steps, such as the review of the Fiscal Responsibility Act, have emerged, effective implementation remains crucial for lasting results. Thus, a commitment to these long-term strategies is paramount for Ghana’s financial health.
Original Source: www.graphic.com.gh
