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10.11.2005 Business & Finance

BUDGET: Second phase of GPRS begins next year

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Accra, Nov 10, GNA - The second phase of the Growth and Poverty Reduction Strategy (GPRS II), for the period 2006 - 2009 will begin next year.

The main thrust of the four-year programme would be to accelerate economic growth and poverty reduction by assisting the private sector to grow and generate employment. Mr Kwadwo Baah-Wiredu, Minister of Finance and Economic Planning, announced this when he presented the 2006 Budget to Parliament in Accra on Thursday.

He said GPRS II was guided by the overall objective of doubling the size of the economy within the next decade and bringing the per capita income of the Ghanaian to middle income status by 2015. Mr Baah-Wiredu said this was expected to reflect in a positive social change and improvement in quality of life for all. "It is in this regard that the growth targets are made taking cognizance of the corresponding objectives and targets of the New Partnership for Africa's Development (NEPAD) and the Millennium Development Goals (MDGs)."

He said NEPAD sought to eradicate poverty in Africa through good governance and the promotion of sustainable socio-economic growth, while the eight MDGs were intended to achieve substantial improvements in the quality of life by 2015.

The eight MDGs are: to eradicate extreme poverty and hunger; to achieve Universal Primary Education; and to promote gender equality and the empowerment of women.

The rest are: to reduce under-five mortality; to improve maternal mortality; to combat HIV/AIDS, malaria and other diseases; environmental sustainability; and to develop a global partnership for development. Mr Baah-Wiredu said significant progress had been made and had continued for some MDGs while for others much more substantial efforts would be required.

He said given the increased growth that the economy had attained in recent years (average of 5.2 per cent) together with the strong supportive environment, it was very likely that Ghana would halve the poverty rate by 2015.

Mr Baah-Wiredu said at the current net enrolment rates, projected trends confirmed that the objective of universal primary enrolment was likely to be realized by 2015.

He said in order to achieve the under-5 mortality rate target, the base figure of 155 per 1,000 in 1988 to approximately 53 per 1,000 live births by 2015.

However, he said current trends indicated that the country had to do more to be able to achieve the target by 2015.

Mr Baah-Wiredu said the Government developed the Ghana Poverty Reduction Strategy (GPRS) as its medium term development policy framework for reducing poverty and achieving sustained growth. The first phase of the GPRS, which ran for three years from 2003-2005, provided the foundation for the Annual Budgets and the programmes and projects that were implemented over the period. Mr Baah-Wiredu said in addition, the GPRS had been used as a basis for donor co-ordination and support through the Multi Donor Budgetary Support (MDBS) mechanism.

He said in addition to the outstanding success in macro-economic management, the GPRS also made quantifiable progress in reducing poverty in some key social and economic development areas.

Expenditure on Poverty reduction activities increased substantially from 2,362 billion cedis or 22.5 per cent of total Government expenditure in 2002 to 5,456.2 billion cedis or 28 per cent of total government expenditure by the end of 2004.