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Thursday, July 25, 2024

The finance minister cannot fool us over the country’s economic realities

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By Ebrima Jarra

No one needs a PhD in economics to know that our economy is in bad shape and the people are suffering. It’s as simple as the old saying “who feels it, knows it”.

Regarding the reckless borrowing of this government which has worsened our public debt situation and caused a sharp increase in interest rates, this is what the finance minister said as quoted by The Standard newspaper, “Minister Keita argued that taking loans is not in itself a problem, it is the usage that matters.”

But we know that the borrowed funds are being used in the worst possible way with no potential tangible benefit for human capital development or macroeconomic growth.

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The minister’s own colleagues in government are on the record as saying that government borrowing is used to finance operations. On the part used for constructing low quality roads for political expediency, why does Seedy Keita think that excessive borrowing for short term political gains is worth the trouble of macroeconomic instability and loss of investment and job creation opportunities?

Regarding his misleading statements justifying the disastrous inflation rate in The Gambia, the minister is simply telling us that he does not care.

The fact that this government hiked the price of electricity in these trying times is the proof that they do not care about the welfare of the poor masses. The rise is cash power tariff is the biggest factor in the most recent rise in the cost of living.

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He deliberately cherry-picked which countries to compare The Gambia’s inflation with. While comparing inflation in The Gambia to that of countries like Ghana and Sierra Leone, the minister is simply telling us that the Barrow government is competing with the worst countries in terms of macroeconomic management in recent times. Why should The Gambia government sink so low?

Contrary to his misleading thesis, this is what the Central Bank’s Monetary Policy Committee says in their latest press release, dated May, 31:

“Global headline inflation continues to decelerate, reflecting declining fuel and energy prices and the impact of monetary tightening.”

So, while global inflation is slowing down, inflation in this country is rising at an alarming rate. This clearly shows that our worsening cost of living situation cannot be blamed on Ukraine and covid alone. There is something wrong with the way we are running our Economy.

The finance minister admitted that inflation in the CFA zone countries is lower. Of course, it will be lower in those countries because their currency is pegged to the Euro and those countries will not be allowed to get into the reckless borrowing and printing of money that the Barrow government is engaged in.

The Gambian economy has suffered untold damage under Seedy Keita’s watch and the burden will be borne by generations yet unborn.

With ballooning public debt and negative real interest rates, this country will not attract the necessary investment and growth levels needed to create jobs for our youthful population.

This situation will further compound our social and political problems, with the possible effect of rising social instability.

The Gambia urgently needs salvation.

Let’s keep our fingers crossed.

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