Stimulus for COVID-19 should focus on critical areas in economy - Economist
Economist - Dr Lord Mensah
An economist, Dr Lord Mensah, is advising the government to direct its incentives aimed at mitigating the impact of the COVID-19 on businesses to critical sectors of the economy such as agro-processing.
According to him, even though players in the hospitality and tourism industry are asking for support, injecting funds into those areas may not yield immediate results.
This comes on the back of President Akufo-Addo’s fourth address to the nation where he directed the Finance Minister to make available a one billion Cedis stimulus package to support businesses in the country.
However, Dr Mensah has a different viewpoint saying that government must critically assess which businesses specifically to support.
In arguing out his point, he said although he supports government’s decision to support the hospitality industry, there is the need to quickly revive areas that have seen the biggest hit in order to wave off the pressure in other areas.
“There are some areas that even if you give them the subsidies or some sectors that even if you give them the subsidies, they won’t get patronage as we speak now… now we are distressed as a country and areas like hospitality, hotels are not key sectors to touch now when it comes to providing stimulus package”.
Also, Dr Mensah is of the stance that the stimulus package may come in the form of tax cut-offs or subsidies to help lessen the pressure on businesses.
“You can provide tax cuts and at the same time subsidies. Provide incentives to areas and possibly that is where the one billion will go. And providing funds does not mean you have to go direct by putting money into people’s pockets. We have to be careful how we go about this,” he stressed.
He explained that providing a stimulus package is in itself an incentive and must engineer economic growth to cover up for losses made or support the vulnerable hence it must be carefully looked at.
“If you provide stimulus package for these sectors, who are those going to patronize it? It’s a problem for people to go to the public and have entertainment and all that in this time,” he said suggesting that some measures can be put in place for players in the hospitality industry in the near future.