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02.09.2005 Business & Finance

Ghana gets 123.5 million dollar Budgetary Support


Accra, Sept. 2, GNA - Ghana has received 123.5 million dollars credit from the International Development Association (IDA), the soft loan lending arm of the World Bank, to complement efforts to stabilize the economy and reduce poverty.

The amount would be used to support both local and foreign expenditure in this year's budget, including crude oil imports and to shore up the country's foreign exchange reserves. It is the World Bank's contribution to the Multi Donor Budget Support Programme for this year.

Finance and Economic Planning Minister, Kwadwo Baah-Wiredu told a press conference that the money would be used to further promote growth, incomes and employment through the implementation of the power sector reforms and the private sector development strategy action plan. In addition the money would help to expand access to basic educational and health services by eliminating Government controlled fees and introduction of capitation grant for girls in public primary schools in deprived districts. It would also help to improve governance and public expenditure management.

Mr Baah-Wiredu said the credit would help to entrench the country's economic stability, create more jobs and provide income opportunities and reduce poverty.

Mr Mats Karlsson, World Bank Country Director, said the release of the money was a vote of confidence in the Government's economic policies.

He cited the increased availability of credit to the private sector, a reduction in subsidies to the utility companies and the cut down in time for business registration as some of the good measures instituted by the Government.

Statistics available indicate that access of private sector to total domestic credit increased by 54.7 per cent by the end of last year while subsidies to public sector utilities companies came down by 40 per cent from 480 billion cedis two years ago to 278 billion cedis at the end of 2004.

There were also increases in share of supervised deliveries, a reduction in the rate of HIV/AIDS prevalence rate among pregnant women and the growth in the gross primary enrolment.

Mr Karlsson said besides these improvements specific actions were taken to strengthen public financial management through the promulgation of the Financial Administration Act; Internal Audit Agency Act and the Public Procurement Act and also improving on the timing and quality of reporting on budget execution.

He expressed the hope that the Government would continue to maintain fiscal discipline to keep the programmes on track.