2021 budget: Previewing roads and infrastructure

2021 budget: Previewing roads and infrastructure
LISTEN JUL 29, 2021

The year 2021 has been marked by a renewed commitment to the Ghana Infrastructure Investment Fund.

After no allocations were made from the Annual Budget Funding Amount to the Ghana Infrastructure Investment Fund for two consecutive years, the 2021 budget indicated a proposed 20 percent of the allocation for ABFA Capex to the fund.

This will be for the funding of Agenda 111, the drive to build district hospitals in needy districts, and other development expenditures.

Capital Expenditure for 2021 was projected at GHS11. 5 billion, which was 2.7 percent of GDP.

Ahead of the ongoing second ‘Year of Roads’, the government said it had demonstrated its commitment to the declaration of the Year of Roads by releasing GHS4,850,968,339, to improve road infrastructure.

In each of the three years prior to the first ‘Year of Roads’ in 2020, the government, on average, released GHS2,091,445,785.09, of budgeted funding for investment in the roads sector.

In line with the Public Private Partnership Act, 2020 (Act 1039), the government plans to activate a unique financing model for roads through the Ghana Infrastructure Investment Fund.

It has said the reconstruction and upgrading of the Accra-Tema Motorway will be the flagship of this model in 2021.

The dualisation of the Accra- Kumasi and Accra-Cape Coast-Takoradi roads, will similarly be financed through Public Private Partnership arrangements.

Heading into the 2021 mid-year budget review, contractors will again be hoping for more assurances on the payment of monies owed to them.

Ahead of the 2021 budget, the Ghana Chamber of Construction Industry complained that about $1.8 billion was needed to settle debts owed to road contractors in the country.

In 2020, the government said out of the accumulated unutilised balance, GHS 471.59 was transferred to the Road Fund to reduce the Fund's indebtedness to road contractors and creditor banks to avoid payment of interest on delayed payments.

In the railway sector, the government plans to complete the 22 km Kojokrom to Manso section of the Western Railway Line, and the 97.7 km Tema to Mpakadan section of the Ghana-Burkina Faso Railway Line.

The latter was about 80 percent complete at the time of the budget reading.

It includes the construction of a major railway bridge measuring 300m across the Volta River between Senchi and Old Akrade.

The development of this railway line marks the beginning of the journey of rail connectivity from Tema through Hohoe, Jasikan, Nkwanta, Bimbila, Yendi, Tamale, Bolgatanga, Paga to Ouagadougou, in line with ECOWAS policy of linking neighbouring countries by rail.

This is in line with the 2020 Railway Master Plan.


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