Dear Editor,
Despite strong economic growth and a rapid post-Covid-19 recovery, Gambians continue to perceive the macroeconomic outlook as irrelevant to their daily lives. According to the recent CepRass Perception Survey, 60% of respondents reported economic mismanagement, citing high cost of living, limited job opportunities, and unequal distribution of resources. While GDP growth is often highlighted by policymakers as evidence of success, it masks structural challenges: inflation has remained elevated at 8 percent annually, the Dalasi has depreciated 1.2 percent against the US dollar, and public debt now absorbs a significant portion of government revenues, limiting investment in social services.
These macroeconomic pressures, combined with sectoral inequality and a trade deficit economy, explain why households struggle despite official growth figures. Monetary and fiscal policies, though intended to stabilise the economy, have had limited impact on currency stability, employment, and living standards, highlighting the divergence between national economic indicators and citizens’ lived realities.
The disconnect between positive GDP growth and household perceptions in The Gambia can be explained using the Quantity Theory of Money and Ricardian Equivalence. Large-scale government spending on infrastructure and post-COVID recovery programs may increase the money supply faster than the growth of real output, contributing to inflation that erodes purchasing power, consistent with the Quantity Theory of Money. Meanwhile, Ricardian Equivalence suggests that households, anticipating future taxes to service public debt, may reduce current consumption despite government investment, further dampening the perceived benefits of macroeconomic growth. Together, these frameworks explain why citizens may perceive the macroeconomic outlook as irrelevant, even amid officially recorded economic expansion.
To enhance citizen satisfaction with the economy, The Gambia must pursue a multi-pronged strategy addressing both macroeconomic stability and household welfare. Monetary policy should focus on stabilising prices and controlling inflation, while fiscal policy must prioritise productive and transparent spending that directly improves living standards.
Addressing the cost of living through targeted subsidies, local production incentives, and income support can mitigate immediate hardships. Simultaneously, employment creation via SME support, skills development, and labor-intensive projects will allow households to benefit tangibly from economic growth. Finally, improving governance and public trust through transparency, citizen engagement, and anti-corruption measures is essential to ensure that macroeconomic indicators reflect real improvements in citizens’ lives.
Ebrima Jarra
Aljamdu Village
