Associate Professor of Finance at the University of Ghana Business School (UGBS) Professor Lord Mensah, has advised the government to find ways to reduce its expenditure as the country struggles to pay back its debts.

According to him, the dire economic situation occasioned by the Covid-19 pandemic as well as potential economic woes to befall the country following Fitch downgrading Ghana’s credit rating to a B- with a negative outlook demands that the government gets creative with finding solutions to the country’s problems.

Prof. Lord Mensah says a viable solution to solving the problem at hand is to keep government’s expenditure fixed for a few years.

Speaking on JoyNews’ PM Express, he explained that it was rather easier to gain more funds from keeping government expenditure fixed against rolling out new taxes.

“I always say that you have control over your expenditure rather than the revenue. Revenue generation sometimes is quite tough and especially when you have economy where the agent within the economy i.e the businesses, and the individuals are not well engaged in terms of economic activities then you want to tax them or levy them around their economic activities obviously you’re going to face resistance.

“And so we have to look at expenditure side. Be bold enough to look at expenditure side and look at how we can prioritise our expenditure. And with that we should be able to take it as a project for the next five years to keep on reducing our expenditure, I mean if for nothing at all keep the expenditure fixed over some years and you’d realize that we should be able to sail through this debt situation. So we shouldn’t panic at all in any case,” he explained.

Meanhwile, he says the government, despite the downgraded credit rating can go ahead and seek funds from the international market through the sale of bonds, however, these may come at a very high cost.