Finance minister, Ken Ofori-Atta, has revealed that government can only get to the IMF Board if it receives sufficient commitment from creditors in support of the debt operation.
According to him, the economy is already responding positively to the news of government and the IMF reaching a Staff Level Agreement (SLA) and it is eager to leverage this momentum to the very moment when the IMF Executive Board approves the Programme requested. He indicated that government is optimistic that the 2023 Budget adjustment strikes the right balance between determination and pragmatism.
“Truly, the eventual conclusion of the program will assist us in our efforts to restore stability, tackle inflation, and strengthen our currency. That is why the various ingredients of the program should be supported by all Ghanaians and all stakeholders. We can only get to the IMF Board if we get sufficient commitment from our creditors in support of the debt operation.”
Ken Ofori-Atta
Mr Ofor-Atta noted that the country is seeing significant improvements in the exchange rate with the Ghana cedi recovering against major currencies and he is hopeful that Ghanaians will continue to support all efforts to restore macroeconomic stability and promote robust and inclusive growth.
“We are confident as a resilient people, and we shall rally to support this great enterprise, to restore macroeconomic stability and promote robust and inclusive growth.”
Ken Ofori-Atta
The finance minister made this comment during government’s announcement that it had reached a Staff-Level Agreement with the International Monetary Fund (IMF) on the financial bailout being sought. He stated that the government and the IMF teams have worked tirelessly to agree on key aspects of the IMF Programme at the Staff Level.
Mr Ofori-Atta highlighted that the key deliverables over the period include preparation of the Post-Covid-19 Programme for Economic Growth (PC-PEG); a Medium-term macroeconomic framework; Debt Sustainability Analysis (DSA) and Debt Management Strategy; Structural reforms to address structural bottlenecks, improve competitiveness and promote efficiency and effectiveness.
Additionally, he underscored that there will be a Memorandum of Economic and Financial Policies (MEFP) and an Agreement on Prior Actions which are expected to be completed before the Fund goes to the Board.
“Ghana stands ready to complete all Prior Actions before the end-March 2023 but more importantly, Ghana is committed to the IMF Programme as a whole.”
Ken Ofori-Atta
Government calls for public support on IMF programme
The finance minister explained that the SLA is only one aspect of the approval process, and more is yet to be done to secure IMF Management and Board approval. That notwithstanding, he revealed that key fiscal measures, structural reforms, and the medium-term macro-fiscal framework in the 2023 Budget are aligned with the IMF-supported Programme and it is therefore crucial that government receives support from all stakeholders.
Mr Ofori-Atta expressed the need for Parliament to ensure that the 2023 budget including all revenue measures are passed and need for creditors to ensure a successful debt operation.
“The 2023 Budget is anchored on increasing domestic revenue mobilization effort by 1.2 percentage points of GDP. On the expenditure side, the 2023 Budget proposes to reduce expenditures (on commitment basis) by about 2 percentage points of GDP from 2022 to 2023. Primary expenditures are expected to be reduced through a reduction in allocation on the Use of Good and Services and Domestically Financed Captial expenditure on a commitment basis.”
Ken Ofori-Atta
The 2023 Budget, the finance minister noted, contains important social protection measures to support the most vulnerable, including measures that seek to gradually increase the number of beneficiary households as well as the value cash transfers under the LEAP. Other social protection programmes which will be prioritised under the programmes, he stated, include the NHIS, the Capitation Grant, and the School Feeding Programme.
“The world is looking at us, and I know we can do it. To God indeed be the glory for the great thing he hath done within 5 months. I am certain that God who began the good work will continue until it is finally finished – Greater things He will do. For we shall gather the harvest with joy. These indeed are both times for a Joseph recovery and a Nehemiah rebuilding. Let us continue with courage, the spirit of love for each other and self-discipline to go through this together.”
Ken Ofori-Atta
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