Mills, BoG governor meet over economy

President John Evans Atta Mills is holding a closed-door meeting with Dr. Paul Acquah, governor of the Bank of Ghana, at the Castle, Osu.

Aides of the President would not specify the theme for the discussion but reporters say the state of the economy would dominate the agenda.

A letter signed by the country director of the World Bank, Ishac Diwan, suggested that the government of the New Patriotic Party (NPP) left the economy in a much worse state than it inherited from the current administration.

According the World Bank, the size of the country's fiscal deficit suggests that government spent 14 percent more than it actually had. The bank said the balance of payment is also likely to grow larger.

Analysts have however been referring to statements by the bank when President Kufuor assumed office in 2001 and conclude that the Breton Wood institution is only painting the previous administration black to please the new government.

Meanwhile the 2008 annual report released by the Bank of Ghana put the country on a safer side.

“The economy was resilient and withstood the cost price pressures arising from oil imports, corrective tariff adjustments in the energy and utility sectors and fiscal stimulus. The external payments position remained strong and GDP growth was robust supported by effective intermediation by the banking system,” the report said.

The bank however indicated that 2008, saw an upturn in inflation requiring some monetary tightening to curb inflationary pressures.

With the government taking office, analysts say a lot of challenges exist to be tackled if the economy can run smoothly.

Economic analyst, Bright Simons, predict Ghana may have to brace itself for a delay in her timelines for the generation of revenue from her oil reserves.

Story by Fiifi Koomson