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04.11.2019 General News

Cabinet To Examine Status Of Economic Turnaround Program Ahead of 2020 Budget

Cabinet To Examine Status Of Economic Turnaround Program Ahead of 2020 Budget

The Minster for Information, Kojo Oppong Nkrumah has disclosed that Cabinet is set to examine the status of the economic turnaround program and approve a framework for the 2020 budget.

According to him, the meeting which was chaired by President Akufo-Addo is focused on examining the results of the governments efforts at correcting the economic challenges inherited at the start of the administration’s work.

Speaking at the Minister's Press Briefing, the Minister said "The meeting also focused on laying down some red lines in the preparation of the 2020 budget".

He added that Inflation which measures the rate at which prices of Goods and services increase, was at 15.3% when President Akufo-Addo took over.

Hon. Oppong Nkrumah noted that through a combination of prudent policies in the real sector, prudent fiscal and prudent monetary policies inflation is now at 7.5%.

He added that the President has instructed the various agencies who have worked to achieve this to keep on the downward inflationary path so that Ghanaians continue to benefit from relatively lower rate of price increase.

"Growth of the Ghanaian economy had slowed down to 3.4% at the end of 2016. Through the various interventions of government particularly in Agriculture (PFJ, PERD, RFJ) growth has seen a rebound and is projected to remain above 6% by the end of 2019," he mentioned.

The Information Minister added that President Akufo-Addo has instructed that resources be made available to continue with programs to engineer growth and jobs across various economic sectors.

He highlighted that this will ensure that our economy continues to create more opportunities for the majority of our people.

Hon. Oppong Nkrumah also revealed that the annual budget deficit, which accounts for the year on year gap between revenues and expenditure has closed significantly.

He noted that in 2016 it was at 9.3% and has now been reduced to 4.7% this year 2020 with a legal commitment to ensure that it doesn’t exceed 5%.

He however emphasised that the President is resolute in his marching orders to the Finance team to ensure this is observed.

Speaking on Interest rates, the Information Minister said "In 2016 the Interest Rate (Int Bank Wgted) as at 2016 was at 25.26. it was reduced to 19.34 in 2017 when Akufo-Addo assumed Office and is recorded a reduction to 15.20 as at September."

He explained that the President has been consistent in urging the central bank to explore ways to push this further down and make cost of borrowing cheaper for the Ghanaian private sector.

Hon Oppong Nkrumah added that the Gross International reserves constituted 3.5months of Import cover as at Dec 2016 however, with gains in exports the Akufo-Addo administration has increased it to 4.1% of import cover as at sept, despite BOGs support during some of the trying moments of our currency.

He noted that Cabinet was additionally pleased to note that 16 flagship programs are being executed despite the fiscal challenges of Ghana.

He said "Key among them is the fact that the administration’s Free SHS program which is designed to ensure that every Ghanaian child, regardless of family wealth, place of birth or gender benefits from basic education to the senior high school level, is working smoothly nationwide".

The Minister stated that President Akufo-Addo has instructed that no resource should be spared in ensuring that the 1.2 million Ghanaian children benefit fully and are prepared to contribute significantly to Ghana’s future growth.

He was of the view that the PFJ program has also be largely successful translating into increased food production with its attendant reduction in food inflation (which has contributed to the reduction in general inflation).

He revealed that President Akufo-Addo has cautioned saboteurs in the business of stealing and smuggling inputs like fertiliser will be dealt with very strongly to deter others.

He underscored IPEP programs which were noted to be progressing nationwide.

The Information Minister mentioned that President Akufo-Addo has also been keen to whip the responsible agencies to speed up the completion of projects for the benefit of the people.

"In preparing the 2020 budget, the President has given firm directives that the fiscal stability which has been restored must not be compromised. The Fiscal Responsibility Act, which is the new anchor of discipline for the government of Ghana, prohibits any government from incurring a deficit beyond 5% of GDP" he disclosed.

He noted that President Akufo-Addo has particularly mentioned that election-year pressures should not and will not cause the treasury to throw away fiscal discipline.

He underscored the need to meet revenue projections is critical in ensuring that our desires as a nation are met.

The Minister mentioned that the Flagship programs of government are also to be completed.

"The President and Cabinet are upbeat about ending the year on a high fiscal and economic performance and delivering a budget for 2020 which will help consolidate the gains made so far for our continued growth and prosperity agenda".

The Information Minister however disclosed that President Akufo-Addo is expected be in Volta Region on November 4 as he embarks on his 2-day tour.