Ghana boosts consumer spending, cushion inflation with salary increase

The Ghanaian government has taken initiative that may see it boost consumer spending with the 15 per cent allowance being given to government employees.

The allowance, designated as ‘base pay cost of living allowance’ (COLA), is to cushion the effects of high inflation in the country.

This will be added to the workers’ basic salary, excluding benefits and bonuses.

Kojo Oppong Nkrumah, Ghana’s information minister, said that the government took the decision after consultations with organised labour and other stakeholders.

“Government and organised labour have concluded negotiations for Cost of Living Allowance. A 15 per cent allowance has been agreed effective July 1. Government is keen on mitigating the impact of global challenges on the people of Ghana,” Mr Nkrumah announced.

President Nana Akufo-Addo had previously directed the country’s finance minister, Ken Ofori-Atta, to begin formal discussions with the IMF to secure funding to address the nation’s economic problems.

Ghana’s inflation rate reached 27.6 per cent, as at June 2022, while that of Nigeria stood at 17.7 per cent for the same month. South Africa’s inflation rate is 6.5 pe cent as at June.