The Institute of Economic Affairs has questioned Ghana's government's capacity to recommend long-term remedies to the country's economic problems, just as it has done with the problems facing other nations across the world.

He contends that the government must address the major causes of the recent increase in the country's inflation rate.

According to the Institute, various nations have established tactics and policies aimed at easing the current problems faced by their citizens.

The current rate of inflation for the month of August is 33.9%.

A statement by the IEA on September 19, 2022, said: “Countries around the world, including major economies, where inflation tends to be mostly demand-driven, and where demand-management approaches, such as IT, may be more appropriate tools, have resorted to interventions directed to the supply factors attendant to Covid-19 and the Russia-Ukraine war. The US has passed the Inflation Reduction Act.

“The new UK Prime Minister has imposed caps on energy prices for two years. France has capped fuel prices and limited electricity tariff increases to 4%. If these countries are taking these unorthodox and innovative measures to cushion their citizens, who are far richer than us, why can’t our policymakers be equally proactive?” he queried.

The IEA also noted that the Bank of Ghana’s IT framework for dealing with inflation has not been able to properly deal with the situation.

“We have repeatedly pointed out the inadequacy of the IT framework in dealing with these supply and cost drivers of inflation, especially at the primary level, although, we acknowledge its potential role in stemming second-round effects of these factors. The supply and cost factors should be directly targeted with appropriate policy interventions,” it mentioned.