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Economic Analyst, Richmond Frimpong, is pointing out that Ghana’s Gross Domestic Product (GDP) growth rate will suffer if stimulus packages are not paid back.
According to him, the funds borrowed are from external sources with interest charges. This means the monies will be paid back with interest.
Former President John Dramani Mahama is promising to make stimulus packages free once voted into power but Richmond Frimpong thinks it’s practically impossible.
He indicated that for Mahama’s promise to happen, it will depend on a number of things.
However, he holds that stimulus packages are meant to stimulate the economy hence his expectation is that “we know exactly how much we’ve given out as loans going to stimulate to see off as output in terms of GDP. If those figures come out in real time and they do so much so that our GDP can now hold the debt that went out.”
Meanwhile, he explained that government can decide to either reduce or scrap the interest rate on return payment.
“The government can choose to say maybe they can pay them at a lesser rate but to say it’s for free will be strange because those funds were not funds that were internally generated from our revenues. They were funds that we went borrowing for and so for nothing at all, we have to pay those funds back, the same way we gave them out,” he said.