The Minister for Finance and Economic Planning, Dr. Mohammed Amin Adam, says the government does not need any supplementary funds for the remainder of the fiscal year, 2024.
According to him, the government is living within its means, as it has been prudent with expenditure, as approved in the 2024 budgetary appropriation by Parliament.
He made this announcement on Tuesday, July 23, 2024 on the floor of the House, in his maiden mid-year budget review, since he took over as the minister for finance.
“We have reined in expenditures to ensure we are within 2024 Budget Appropriation and exceeded the mid-year non-oil revenue target by 3.7 percent. In effect, Mr. Speaker, we are living within our means.
“Indeed, consistent with our programme with the IMF, we are on course to achieving a primary surplus of 0.5 percent of GDP by end of the year,” he said.
The Minister for Finance presented the mid-year fiscal policy review in fulfilment of section 28 of the Public Financial Management Act, 2016 (Act 921).
He told Parliament that over the last six months, the government has sought to bring some urgency and speed to the implementation of key programmes and also provided the necessary support for growth-enhancing initiatives.
PROGRAMMES
Among others, he said the government had successfully concluded the second review of the Extended Credit Facility with the International Monetary Fund (IMF), leading to the disbursement of the 3rd tranche of US$360 million.
He also said the government has completed the debt restructuring programme with the Official Creditor Committee (OCC), covering US$5.1 billion, resulting in approximately US$2.8 billion of debt relief.
The government has also concluded negotiations with five of the seven Independent Power Producers (IPPs), which will lead to a saving of some of US$6.6 billion over the lifetime of the Power Purchase Agreements (PPAs).
“We have disbursed GH¢5.4 billion to support LEAP, the School Feeding Programme, the Capitation Grant and NHIS since January 2024, to reduce the burden on the vulnerable in our country.
“We have spent about GH¢1.5 billion to support 1,488,575 students under the Free SHS programme between January and June this year,” the Minister said.
He continued that: “We have paid about GH¢12 billion to bondholders under our Domestic Debt Exchange programme since February, to demonstrate our commitment to the programme. We have invested almost GH¢10 billion in the road sector since January 2024 to enhance transportation and spur growth.
ABOUT DEBT
The Minister for Finance giving an update on the public debt developments in 2023 and the first half of 2024 indicated that, as of end-December 2023, the provisional central government and guaranteed debt in nominal terms was GH¢608.4 billion.
He explained that the figure was made up of GH¢351.1billion and GH¢257.2billion for external and domestic debt, respectively.
He also said that the provisional total central government debt as of end-June 2024 stood at GH¢742.0 billion, equivalent to 70.6 percent of GDP.
This, he noted, indicates an increase of 22.0 percent due to the effect of the cedi depreciation and disbursements from creditors.
He observed that the stock consists of external debt of GH¢452.0 billion and domestic debt of GH¢290.0 billion, representing 60.9 percent and 39.1 percent of the total debt stock, respectively.
As a percentage of GDP, external and domestic debt represented 43.0 percent and 27.6 percent, respectively.
CABINET APPROVAL
Meanwhile, the minister for finance announced that Cabinet has also granted approval for the disbursement of an additional GH¢1.5 billion to provide relief and bailout for those whose funds have been locked up in the fund management companies.
He also said approval has been given by the cabinet for the establishment of a framework “for the re-introduction of road and bridge tolls in 2025.”
Cabinet, the minister announced, has also approved the operationalisation of the integrated property tax system and a review of the Fiscal Responsibility rules to include a debt rule to support debt sustainability, as well as the establishment of an independent Fiscal Council.
