Mid-Year Budget Review: Economy Bouncing Back Fast

Ghana’s economic growth continues exceed expectations as the  4.7 percent growth rate reported by the Ghana Statistical Service (GSS) for first quarter 2024 exceeded the revised target of 3.1 percent; Minister of Finance, Dr. Mohammed Amin Adam has stated.

“The economy is rebounding stronger than anticipated. The choices we have made and the policies we are implementing are yielding results. We have reversed the negative trends, all the indicators are looking better.

“I want to assure you that we will stay on this path and continue to make the right choices. Our economic recovery is fast and strong”, Dr. Amin Adams noted during his presentation of the 2024 mid-year fiscal policy review in Parliament on Tuesday, July 23, 2024

He continued that one of the key factors yielding the positive results was that Government has embarked on a number of decisive measures to get us back on the path of fiscal consolidation, economic stability and growth.

“I am happy to note that these policies that we have implemented are yielding the expected results… Inflation is declining. End-June inflation rate of 22.8 percent, a reduction of 31 percentage points since December, 2022, confirms the target threshold of +/-2 of 15 percent by end 2024 is possible;

“Exchange rate has largely stabilised, compared to December, 2022, despite the recent pressures. The 18.6 percent depreciation rate to the US Dollar as of June 2024, represents an improvement over the 22.0 percent recorded for the same period last year; and  Gross International Reserves reached 3.1 months of import as at end June 2024 against 2.5 months of imports in the same period last year”, Dr. Amin Adams noted during his presentation to Parliament.

The Finance Minister said Ghana has successfully concluded the second review of its Extended Credit Facility with the International Monetary Fund (IMF) which led to the disbursement of the 3rd tranche of 360 million US Dollars, bringing total disbursement to about US$1.6 billion.

The country, the Minister continued, has also “completed the Debt Restructuring programme with the Official Creditor Committee (OCC), covering US$5.1 billion dollars resulting in approximately 2.8 billion US Dollars of debt relief. This means that we will not service our debt to our official creditors from 2023 to 2026.

“We have concluded negotiations with our Eurobond holders, covering 13.1 billion US Dollars, which will lead to a cancellation of 4.7 billion US Dollars of our debt and provide debt service relief of 4.4 billion US Dollars between 2023 and 2026”, Dr. Amin Adam added.

Meanwhile, the Minority Leader Dr Cassiel Ato Forson has criticised the mid-year budget, describing it as uninspiring and hopeless.

“This mid-year review leaves many people disappointed and uninspired. It gives no hope to the ordinary Ghanaian that anything will be done to change the unbearable hardships that confront the people of Ghana.”

“In the last eight (8) years, Akufo-Addo and Bawumia have burdened Ghanaian businesses and individuals with high tax regime such as E-levy, COVID levy, an effective VAT rate of 22%….” Dr. Forson noted.