- Ken Ofori-Atta is characteristically wearing a white Kaftan, used in 2017, 2018 and 2019.
He says God’s blessing of hard work is beginning to manifest in the country.
“We have stabilized the macroeconomic turbulence”
- The Minority are unhappy about the minister’s reference to the poor state of the economy the government says it inherited in 2017 from the NDC.
- “It was a case of living for today and leaving tomorrow to take care of itself.”
- The Minority are heckling the minister for his reference to Bible verses about “God supplying all your needs according to his riches in glory.”Bible verses are a constant feature of the Finance minister’s budget statements. So has the heckling.
- Despite the limited resources at the government’s disposal, it implemented flagship programs, gave out stimulus packages and funded social programmes.The economy has experienced an economic miracle. “I speak to the data”. Economic growth as doubled under Akufo-Addo. Inflation has fallen from over 15% in 2016 to 7.6% in 2019 – the lowest rate in 27 years. The year 2019 has experienced, the slowest ever rise in prices in the entire 4th republic.
- He explains three reasons why the 2020 budget is important.
- It is an election year budget.
- It is the second budget since Ghana’s exit from the IMF
- It is the first budget to be prepared following the passage of the fiscal responsibility act
In 2020, the government will focus on these things.
- Radical politics to raise taxes not by introducing more but through enhanced collections.
- Intensify Foreign Direct Investment
- Enhance financial support to local enterprises
- Use digitization to improve government services
- Accelerate infrastructural development
- Focus on science and technology and its commercialization.
- Resource the Electoral Commission to run free and fair elections.
He says the government will not overspend because it wants to win elections.
“We are not prepared to throw away all the sacrifices and gains over the last three years”.
- In the last two years, Ghana is among the fastest-growing economies in the world. And this is not because of oil.
- He highlights the importance of macroeconomic stability in helping the country achieve her development objectives.This is why the Fiscal Responsibility Act has been passed to check reckless decision-making.
- Fiscal deficit projected to reach 9% of GDPTotal public debt: 28.6bn cedisRate of debt accumulation excluding banking sector clean-up: 14.1%
- *Correction: Total public debt is GHC208.6 billion (including the cost of the banking sector clean-up) at the end of September 2019.
- Overall Real GDP growth to average 5.7 percent for the period;
- Non-Oil Real GDP to grow at an average of 5.9 percent for the period;
- Inflation to be within the target band of 8±2 percent;
- Overall fiscal deficit to remain within the Fiscal Responsibility Act Threshold of not more than 5 percent of GDP;
- The primary balance to be in a surplus; and
- Gross International Reserves to cover at least 3.5 months of imports of goods and services.
- The following specific macroeconomic targets have been set for the 2020 fiscal year:i. Overall Real GDP growth of 6.8 percent;ii. Non-Oil Real GDP growth of 6.7 percent;
iii. End-period inflation of 8.0 percent;
iv. Fiscal deficit of 4.7 percent of GDP;
v. Primary surplus of 0.8 percent of GDP; and
vi. Gross International Reserves to cover not less than 3.5 months of imports of goods and services.
- Resource Mobilization for 2020Total Revenue and Grants for 2020 is projected at GH¢67.1 billion (16.9% of GDP).Domestic Revenue is estimated at GH¢65.8 billion.
Grants disbursement from Development Partners is estimated at GH¢1.2 billion (0.3% of GDP).
- Total Expenditure (including clearance of Arrears) is projected at GH¢85.9 billion (21.6% of GDP) in 2020.Wages and salaries are projected at GH¢22.9 billion and constitute 26.7 percent of the Total Expenditure (including Arrears clearance).
Use of Goods and Services is also projected at GH¢8.3 billion (2.1% of GDP) and 9.7 percent of the Total Expenditure (incl. Arrears clearance).
Interest Payments on public debt is projected at GH¢21.7 billion (5.4% of GDP).
- From 36 banks in 2016, Ghana now has 23 banks following the banking sector reforms began in August 2017.
Nonetheless, total assets in the banking sector have increased from GH¢89.1 billion in 2017 to GH¢115.2 billion at end August 2019.
Total deposits have improved from GH¢55.7 billion to GH¢76.0 billion over the same comparative period, reflecting a stronger deposit base owing to more trust and confidence in the banking sector with fewer but stronger banks.
- Government spent a total GH¢11.7 billion to safeguard the deposits following the banking sector clean-up.
Government estimates that GH¢2.4 billion will be spent to provide relief for depositors following the revocation of the licenses of 347 Micro Finance Institutions, 15 Savings & Loans and 8 Finance Houses.
The Securities and Exchange Commission also revoked the licenses of 53 Asset Management Companies that were distressed, with an estimated fiscal cost to protect investors of GH¢1.5 billion.
Government also provided bridge funding of up to GH¢800 million for Ghana Amalgamated Trust (GAT) to enable it invest in four (4) indigenous banks that were struggling to meet the minimum capital requirement GH¢400 million.
By : Aboagye Frank Jackson / Kingdom 107.7 FM / Kingdomfmonline.com / Jakoadepa@gmail.com / Ghana / 2019