An economist at the University of Ghana Business School (UGBS) says government’s expenditure plays a critical role in the rise of inflation in the country.

According to Prof Lord Mensah, inefficient investments are driving inflation in Ghana to unbearable rates.

“The monetary policy alone will not be able to tackle the issue on the ground but we should look at the way government’s spends because it goes a long way to tackle inflation.

“Government is spending into areas that is not efficient enough. It is spending in areas of the economy that is not building up into permanent job creation among others," the economist said.

Speaking on Joy FM’s Super Morning Show, Prof Mensah said should government invest in infrastructure such as roads, spare parts importation will reduce, thus, affecting the growth of inflation.

“Government should find a way to get all food produced through ‘Planting for Food and Jobs’ unto the market. And that will be by providing good roads.

“Government taking money from the Bank of Ghana and then more or less using the monetary policy rate to change that kind of liquidity at the level of government won’t work. But the way the money should be spent would be able to control inflation,” he said on Tuesday.

Ghana’s economy is in distress as it currently has a total public debt stock of GH¢391.9 billion, as of the end of the first quarter of 2022.

The cedi is also the worst-performing African currency and has weakened 22 per cent against the dollar this year.

The latest figures released by the Bank of Ghana put Ghana’s total public debt stock, as of June 2022, at $54.4 billion or ¢393.4 billion.