The suspension includes payment obligations on Eurobonds, commercial term loans, and most bilateral debt.
According to a statement issued by the Ministry of Finance on Monday, December 19, 2022, the move is part of a comprehensive debt sustainability programme by government to evaluate its debt portfolio and put in place appropriate measures that will help bring the country’s debt situation to sustainable levels with a debt to Gross Domestic Product (GDP) target of 55 per cent by 2028.
“We are also evaluating certain specific debts related to projects with the highest socio-economic impact for Ghana which may have to be excluded. This suspension is an interim emergency measure pending future agreements with all relevant creditors”, the statement explained.
The statement added that the government stands ready to engage in discussions with all of its external creditors through a fair, transparent and comprehensive debt restructuring exercise in line with international best practices.
Already, the announcement of the suspension is generating a high level of support from the investor community with some anonymous sources describing it as a “friendly match”, indicating that government should make it a point to share detailed economic and financial information throughout the process.
Meanwhile, government has also taken steps to restructure its domestic debt through an exchange programme. The programme, launched on December 5, 2022, is designed to offer relief to the country’s fiscal accounts through an exchange in coupon package on domestically issued bonds providing a solid foundation for Ghana to in the long-term downsize its debt and reboot the economy.
The finance minister, however, stated that so far, the announcement has in part helped the cedi stage a remarkable rebound against its major trading partners, as the demand for forex has significantly reduced, thereby helping the government to conserve its foreign reserves that have come under serious pressure in recent months.
Analysts expect that the suspension of external debt payments will help the cedi continue its upward trajectory against major trading currencies.
Former trainees under the Nation Builders Corps (NABCO) have given the government a one-week ultimatum to pay their 9-month arrears.
According to them, several engagements with the government to pay allowances owed to them have proved futile.
Speaking to Citi News, the Public Relations Officer of the former NABCO trainees, Naa Techie expressed his sentiments over the delay in payment of arrears owed them.
“A number of demonstrations have been staged. If you would recall, we earlier sent an official petition to the Speaker of Parliament to add his influential voice to our resentment for the payment of arrears and nothing has been done about it. We have submitted another petition to the NABCO secretariat and they have not responded. We haven’t heard anything from them,” he said.
Expressing the emotions of these former NABCO trainees, he said, “the indication is that NABCO trainees have been left in limbo. NABCO Trainees have been subjected to incessant public ridicule, and they have also been subjected to severe hardships and are in a state of starvation to death.”
Naa Techie also confirmed that a letter has been sent to the finance minister, and they are awaiting his feedback. However, he threatened several protests till their demands are met.
“We have sent a letter to the finance minister. Probably it will end next week Wednesday and we will stage several demonstrations if demands are not met,” he added.
The NABCO program was introduced in 2018 as one of the policies of the Akufo-Addo-led government to ease unemployment in the country.
However, a directive was issued for all beneficiaries to remain at their post even though the program ended in 2021.
The decision, made by Professor Osei-Agyeman Yeboah, a Lecturer at the North Carolina Agriculture and Technical University, will enhance farming and smallholder farmers’ access to advice on the best crops for their soil and the best local fertilizer recipes for good harvests, according to Professor Yeboah.
He made the recommendation at a USDA-NIFA Projects farmer outreach event at Sanpebga in the Kumbungu District to highlight the top technological advancements to boost Northern Region production, food security, and nutritional health benefits.
It was on feed harvesting, silage preparation, good livestock husbandry practices, commentary feeding, crop residue management, and compost preparation, and was conducted at the farm level to create awareness of integrated soil fertility management strategies, compost preparation, farm residue recycling, intercropping and improved varieties.
Professor Yeboah, who is also the Project Leader for the United States Department of Agriculture (USDA) and National Institute of Food and Agriculture (NIFA) Project, said, “Soil is a critical part of thriving agriculture, which provides the necessary nutrients for crop growth. However, not all soils are suitable for growing crops.”
He said regular soil testing could help improve soil health, which was typically inaccessible and too expensive for smallholder farmers.
He stated that mostly the small farmers had limited access to correct information to remedy deficiencies leading to incorrect or insufficient agro-input use that adversely affected soil health, productivity, and local ecosystems.
The Government of Burkina Faso has reportedly recalled its ambassador to Ghana over President Nana Addo Dankwa Akufo-Addo’s accusations that the country is hiring Russian mercenaries.
According to security analyst Adib Saani, who disclosed this to GhanaWeb, the Burkinabe government has also summoned Ghana’s ambassador to Burkina Faso to answer questions about President Akufo Addo‘s comments.
BBC Journalist Lalla Sy, who confirmed the move by the Burkinabe government, said that Burkina’s ambassador to Ghana was recalled for consultation over President Akufo-Addo’s accusations.
Lalla Sy, in a report on the BBC website, on December 16, 2022, said that Ghana’s ambassador to Burkina Faso was summoned for a meeting on Friday morning over the allegations Akufo-Addo made.
President Nana Addo Dankwa Akufo-Addo has called on the US government to help deal with the threat of Russian mercenaries on Ghana’s border with Burkina Faso.
According to the president, Ghana’s security apparatus has noticed the activities of these Russian mercenaries along its borders in the north who have been contracted by the Burkinabe government.
Addressing officials of the US government, including Secretary of State Anthony Blinken, at a meeting in Washington, Akufo-Addo said that the Burkinabe government had contracted these mercenaries to help them fight Islamic militants in their country and is paying them by giving them a mining concession.
“I think that beyond everything, there is a matter that I want to urge upon you. Today, Russian mercenaries are on our northern border. Burkina Faso has now entered into an arrangement to go along with Mali in employing the Wagner forces there.
“I believe a mine in southern Burkina has been allocated to them as a form of payment for their services. Prime minister of Burkina Faso in the last 10 days has been in Moscow. And to have them operating on our northern border is particularly distressing for us in Ghana,” he said.
President Nana Addo Dankwa Akufo-Addo has called on the US government to help deal with the threat of Russian mercenaries on Ghana’s border with Burkina Faso.
According to the president, Ghana’s security apparatus has noticed the activities of these Russian mercenaries along its borders in the north who have been contracted by the Burkinabe government.
Addressing officials of the US government, including Secretary of State Anthony Blinken, at a meeting in Washington, Akufo-Addo said that the Burkinabe government had contracted these mercenaries to help them fight Islamic militants in their country and is paying them by giving them a mining concession.
“I think that beyond everything, there is a matter that I want to urge upon you. Today, Russian mercenaries are on our northern border. Burkina Faso has now entered into an arrangement to go along with Mali in employing the Wagner forces there.
“I believe a mine in southern Burkina has been allocated to them as a form of payment for their services. Prime minister of Burkina Faso in the last 10 days has been in Moscow. And to have them operating on our northern border is particularly distressing for us in Ghana,” he said.
Akufo-Addo also stated that Ghana was against Russia’s occupation of Ukraine and the use of African countries as training grounds for foreign powers, particularly Russia.
“Apart from not accepting the idea of great powers once again making Africa their theater of operation, we have a particular position that you know about over the Ukraine war, where we have been very, very vocal and up front about condemning the invasion of Ukraine by Russia,” he said.
Illegal mining, known commonly as ‘Galamsey‘ has been a major challenge facing Ghana with its dire effects on the country’s environment.
The serious threat posed by this phenomenon to Ghana’s environment including water bodies has compelled the government of Ghana to initiate a fight against it.
While a section of the population are blatantly against galamsey and have vehemently expressed their dissent to the development, quite a few individuals seem to be on the fence with respect to the menace.
A young man by name Kobby has narrated how his life ‘got better’ through galamsey as well as losing his best friend in the process.
According to him, he was working as a vulcaniser but the money he was earning from it was inadequate to cater for his basic needs. He then decided to venture into the galamsey business.
On his first day at the mining site, he realised the work was not easy but he had no option than to persevere through it.
He learnt on the job, the various types of galamsey including ‘bowhewe’ which literally means ‘dig and search’ in the Akan language, which is the one that involved excavators degrading the land.
“I did a couple of it but I mostly do the ‘bowhehwe’, the excavator one. I followed a friend but it didn’t work because it was dangerous for me and it was mostly owned by wicked Chinese with less money”, he said.
He revealed that on his first day, he earned only GH¢30 but was assured by some of his colleagues that his remuneration would increase with time and that encouraged him to put much effort into his work.
The highest amount of money he has earned from the business was GH¢1000 a day, which he said he saved it to further his education.
He also added that the galamsey business was a “dangerous” one that comes with a lot of problems including drowning and loss of lives especially those who engaged in underground mining as on some occasions, the top of the soil can break and cover your back.
Explaining how risky the underground mining was, Kobby recounted how he lost his best friend through it.
“He was my best friend. used to go underground with him. A very hardworking guy. We went underground for gold. I took the lead. When I got back, I was waiting for him at the entrance of the pit not knowing the soil collapsed n covered the middle way of the pit. I couldn’t find him afterwards. That was when I realized that my friend had lost his life” Kobby painfully recounted.
Kobby said that was when he advised himself to stay away from such a job and went into different ventures.
He pleaded with people having the intention of engaging in galamsey to stay away because it destroys the nature of the land and the loss of lives is terrible.
The Executive Director of the Africa Education Watch, Kofi Asare, has described the payment of allowances to trainees at the Colleges of Education as a wasteful expenditure that must be scrapped with immediate effect.
Mr Asare said if the government intends to deliver on its 2023 budget policy then some wasteful expenditures must be cut.
According to him, the government is spending far more on Senior High Education to the detriment of basic education, a situation that creates a lacuna in basic school development.
Speaking at a roundtable discussion organized by the Citizen’s Coalition in Accra, Mr Asare noted that, much of the expenses done in the Education sector must be reconsidered taking into account the poor implementation and deficiencies that are impacting negatively the quality of education in Ghana.
“I think the budget failed to appreciate that there is a certain wasteful expenditure that should leave the education space, especially teacher trainee allowance. The government has repeated that it intends to spend 241 in 2023 to feed adult trainees who are in tertiary education and have the right to access student loans just like other tertiary students.
“In austerity, the government must be cutting down on wasteful expenditure and spending more on the vulnerable, we also don’t see more enhanced spending on Free compulsory basic education,” Mr Asare said.
Meanwhile, the Africa Education Watch has petitioned Parliament to reject the allocation of GH¢1.8 billion made to the Ghana Education Trust Fund (GETFund), a major education infrastructure financing facility in Ghana.
“The sharp decline in the 2023 allocation raises serious concern about the formula used in capping the GETFund in the 2023 budget, and whether it is in accordance with the Earmarked Funds Capping and Realignment Law.
“Going by the 25% capping under the Earmarked Funds Capping and Realignment Act, 2017 (Act 947) and the history of allocations in line with the same, we estimate that, at least GHC 2.7 billion, representing 60% of the total 2022 GETFund Levy accruals of GHC 4.6 billion should be allocated to the GETFund for 2023.”
Students of Mando Senior High Technical School in the Ajumako Enyan Essiam District of the Central Region, have bemoaned the poor quality of meals served to them during dining sessions.
According to the students, they used to be served quality meals in the past, however, things have changed now as they sometimes do not get served any meals during the weekends.
Speaking in an interview with Class FM’s Central regional correspondent, Nana Tawiah, some of the students explained: “Our dining situation is bad. In the mornings, we are served tea, for lunch ‘Egbeme’ and for supper, rice water. You can see the rice under the water, no sugar, so you have to take your own sugar.
“The tea is so light, if it pours in your uniform, you can use it to wash the uniform. The dining situation is very poor, so, we’re appealing to the government to come to our aid,” a female student explained.
Another female student said: “We haven’t been served any good food since last month”.
“The day we’ll get some solid food will be days they serve Kenkey, no fish; even if they add fish, the stew is more than water, one mackerel for two tables or 20 people. Even with that, it’s once in a while. The food is bad, and it’s insufficient.”
“We’re served only liquid food thrice a day, they must at least serve solids.”
Another female student indicated that due to the poor quality of meals served, the students fall sick frequently and have to go home.
“Sometimes, they give us tea in the morning, in the afternoon, too, when you’re expecting solid food, you get there and they ask you to go for your cups, they serve you tea again. In the evening, too, you get there and they serve you Oblayo or rice water, the rice water too, you can pour the water away and add pepper to it to eat. The situation is bad”.
“Mando Senior High Technical, we’re pleading with the government and the authorities, in the name of God to help our school. We’re suffering. There are some among us who do not have money, since morning they have been sitting around starving. The tea is so light, lots of people are falling sick and have to go home. We plead with the government to help us otherwise when school vacates and we go back home, we’ll not return to school again.”
The students also bemoaned the inability of some of their parents to understand their plights, as it is believed that the government is catering for them under the current free Senior High School (SHS) programme.
“Our mothers, too, think when you come to school, you eat well, so, when you call to ask them for money or bring you food, they’ll be saying, aren’t you the ones who are being catered for by the government, why again are you calling for food or money. They really do not understand our situation,” one of the students stated.
Another student added: “When we came previously, they used to serve us Jollof and sausage”.
“There’s no money; when you ask your mum for money, it takes about a week to arrive, when it comes too, you have a lot of bills to pay because you’re owing people and have to pay for the extra classes or that.”
According to reports, after taking office 16 months ago, Special Prosecutor Kissi Agyebeng has not received compensation.
According to a report by myjoyonline.com, all the staff at the Office of the Special Prosecutor except for the Deputy Special Prosecutor have also not been paid all their salaries.
The report also indicated that documents available to JoyNews show that the former Special Prosecutor, Martin Amidu, is also owed arrears.
It added that the lack of payment has left the affected staff becoming agitated.
The Special Prosecutor, Kissi Agyebeng, according to a JOY FM document said that the situation is very worrying since the lack of payment leaves the affected staff in a vulnerable state, which might derail the fight against corruption.
Kissi Agyebeng, therefore, called on the government to put the necessary measures in place to ensure that his staff are given their compensation.
Kissi Agyebeng officially assumed office on Thursday, August 5, 2021, as the country’s second Special Prosecutor after being sworn into office by President Nana Addo Dankwa Akufo-Addo.
The Office of the Special Prosecutor was established in 2018 by President Akufo-Addo as the gold standard and flagship specialized independent anti-corruption institution in the country.
Its main objective is to prevent, investigate, and prosecute corruption and corruption-related offenses, as well as recover assets that have been stolen from the state.
Government says persons believed to have caused financial losses to the State leading to the banking sector clean-up will be duly prosecuted.
Deputy Attorney General and Minister of Justice, Alfred Tuah-Yeboah maintains, bank owners such as Dr. Kwabena Duffour of uniBank and Kofi Amoabeng of UT Bank and others will be prosecuted in order to recover monies misspent.
This comes after an Accra High Court changed its position and accepted the GH¢90 million repayment terms for a restitution deal between state prosecutors and Ato Essien, the embattled founder of now-defunct Capital Bank.
The Bank of Ghana revoked the licenses of nine banks during the financial sector clean-up.
They included UT Bank, Capital Bank, Sovereign Bank, Beige Bank, Premium Bank, The Royal Bank, Heritage Bank, Construction Bank and uniBank.
Some former officials of these banks are facing several charges over their purported culpability in leading to the collapse of the financial institutions.
Speaking in an exclusive interview with Citi News, Alfred Tuah-Yeboah confirmed that, government’s quest to retrieve the monies and prosecute all other suspects is on course.
“Some of them are in court now facing prosecution. UT Bank is in court now. For uniBank, there are some people in court now same as Beige Bank”, he emphasized.
“We are also looking at the Savings and Loans and Microfinance Companies. In fact, EOCO and other investigative bodies have done so much and extensive work on these institutions. So we are preparing the dockets. Our mission is to prosecute and possibly recover”, the deputy AG continued.
In a related development, the second and third accused persons in the Capital Bank case, Tetteh Nettey and Rev Fitzgerald Odonkor respectively have been acquitted and discharged by an Accra High Court.
The two were both charged alongside the founder of the defunct bank Ato Essien.
With that same case that the Court reconsidered its decision on the GHC 90 million deal between founder of capital bank Ato Essien and the State, Alfred Tuah-Yeboah argued that the funds were state funds as the defunct capital bank has been taken over by the state and state funds expended to pay the monies of depositors.
Earlier, Justice Eric Kyei Baffour, a Justice of Appeal, sitting as an additional High Court Judge, rejected the agreement, indicating that the amount agreed to be paid was not good enough, and adjourned the case to December 13 for the parties to address the court on the legal basis of the terms of the agreement.
The University of Ghana lecturer encouraged the government to form a commission for the nation’s rice production immediately.
He claims that if the government focused on domestic rice production, the nation’s $1.2 billion yearly rice import expenditure might be reduced.
While praising government’s intention to reduce rice imports, the development economist suggested that government should set up a committee that would include players in the rice industry’s value chain and discuss how to fully implement the ban on rice importation plan.
“Ghana imports $1.2 billion worth of rice annually. This can be reduced drastically if we concentrate on the local production of rice,” he stressed.
The Development Economist added that the committee will monitor and involve stakeholders in the rice business to make sure there were no lapses as local rice starts to take a larger share of the market.
He made this call at an economic forum organized by the Danquah Institute in Accra, according to Graphic Online.
In addition to that, he also stated that when that was done, not only would it curb the rapid fall of the cedi but also create jobs for Ghanaians who would earn more and pay taxes for economic growth and development.
“We have to manage our economy well by simply paying attention to some of the key sectors that drive economic growth,” he said.
He finally added that raw materials from agriculture should be turned into finished goods through manufacturing.
Speaking at the 2nd Annual District Auditors’ Conference on Monday, December 12, 2022, the Vice President since assuming office in 2017, the Akufo-Addo government has made a sustained, aggressive push in the fight against corruption by enacting laws, tightening existing ones, and introducing greater digitalization in governance and the use of public funds while increasing resources allocated to the fight.
“On assuming office, corruption was prevalent in many areas such as the DVLA, where one had to pay a bribe to ‘goro boys’ in order to get a drivers licence; same thing at the Passport Office; Customs and other officers were having a field day at the ports; it was difficult renewing ones NHIS, and for some reason, dockets kept getting ‘missing’ at the courts.
“There was inadequate funding for anti-corruption agencies; the Right to Information Law had not been passed; there was no legal backing for a beneficial assets register; and no law on Witness Protection.
“But since 2017, we have taken a number of far-reaching steps in the fight against corruption, including the implementation of a digitization agenda to disrupt corruption in the public sector.
“To further boost the fight against corruption, deficits in logistics and personnel of law enforcement agencies, especially the Ghana Police Service, and other accountability institutions, are being addressed,” he emphasized.
“For instance, since 2017, Government has increased budgetary allocations to all the accountability institutions of State, including Parliament of Ghana, the Judiciary, CHRAJ, EOCO, the Office of the Attorney-General and Ministry of Justice, the Auditor General, the Office of the Special Prosecutor and the Ghana Police Service,” Dr Bawumia stated in Accra.
While commending the Auditor General, Mr Johnson Akuamoah Asiedu, the Board of the Audit Service and staff of the Service for the “very good work being done”, Vice President Bawumia reminded the District Auditors and their colleagues across the country that when corrupt activities such as financial improprieties such as misappropriation of funds, payroll fraud, and contract and procurement irregularities take place, the expectation of the taxpayers is that the public officials who commit these financial crimes would be sanctioned according to law.
“One of the functions of the Auditor-General which can combat these financial malpractices is disallowance of any item of expenditure which is contrary to law and surcharge the amount of any expenditure disallowed.
“The public, and, in particular the Civil Society Organisations have expressed dissatisfaction that the Auditor-General has not performed this critical function effectively. I am informed that the District Auditors will use greater part of this conference to discuss this very important topical issue of disallowance and surcharge. I expect these discussions to produce outcomes to inform the processes for disallowances and surcharges.
“Nevertheless, let me assure the Auditor-General and Members of the Audit Service Board that in the same spirit of cooperation, The Government of Nana Addo Dankwa Akufo-Addo will continue to provide the necessary support to the Audit Service to ensure that it operates independently as the Constitution of the Republic of Ghana mandates.”
The amount given is larger than what Ghana anticipates from the IMF if an agreement is reached.
Additionally, Fitch predicted that Ghana will pay $3 billion in interest and amortization as part of its debt service obligations in 2023.
Ghana continues to borrow money to fund its projects and flagship programs, which has resulted in a debt-ridden economy.
Bloomberg in its December 9, report said “Ghana, a regular client of the IMF — this is its 17th request to the fund — has often failed to meet targets set in previous programs, including the last one, which ended in 2019 with a waiver from the fund, essentially rubber-stamping its lack of progress. The government’s decision to aggressively tap Eurobond markets in 2020, so soon after that program ended, spooked investors and led the agencies to revisit their ratings.”
“A government plan to slash expenditure by 20% did little to assuage the market,” it added.
After continuous downgrades by rating agencies since the beginning of the year which saw Ghana get kicked out of the international capital market, the country has battled with harsh economic conditions coupled with high inflationary pressures, soaring interest rates, and cost of borrowing as well as a depreciation of the cedi.
However, bondholders and creditors have expressed their disagreement with the programme. According to them, proper consultation and consensus-building have not been achieved.
“There is no more stigma around defaulting or restructuring, and this is quite unusual in the context of emerging markets history. It is part of the natural economic cycle,” Yerlan Syzdykov, a global head of emerging markets at Amundi SA, Europe’s biggest money manager that is a member of the Ghana bondholders committee was quoted by Bloomberg.
As part of the IMF conditionalities as noted, the finance minister also announced a freeze in public sector employment in 2023 and an increase in the Value Added Tax by 2.5%.
It is estimated that Ghana loses up to $25 million annually via unfinished projects. This amount is equivalent to 667 additional three-unit classroom blocks per year which would accommodate an estimated 70,000 students, a study has shown.
The study was conducted in Ghana between 2014 and 2017 by Dr. Martin J. Williams, Associate Professor of Public Administration at the Blavatnik School of Government, the University of Oxford in collaboration with the National Development Planning Commission (NDPC) and the Local Government Service Secretariat (LGSS).
The study shows that about a third of projects started between 2011 and 2013, were never completed.
Presenting a paper on Spatial Infrastructure Data in Ghana, Dr. Williams said the costs of unfinished projects to Ghana, both economically and socially were huge, as shown by the administrative data that already exists within the government.
These administrative data included hardcopy reports or soft copy word documents submitted by local governments to MMDAs or the NDPC as part of normal annual performance reports.
By collating and transforming this data into a database covering about 14,000 projects across a wide variety of agencies and funding sources such as the District Assemblies Common Fund (DACF), GETFund, Internally Generated Funds, and central government funding.
He said 18.6 percent of MMDAs investment expenditure was on projects that were unlikely to ever be finished, noting: “that’s almost a fifth of infrastructure budget going straight into waste”.
He said, “these are mostly small projects that are being done by the MMDAs, so these are six-room classroom blocks, boreholes, wells, administrative blocks; the kind of projects that should take between four and 12 months on average”.
The study also found that contrary to popular opinion that unfinished projects were due to corruption and politics or elections, the findings showed that neither of these was the cause.
It said more work has been done on the projects than had been paid for and project completion rates were also consistent across the years.
Rather districts were spreading their resources for projects too thinly on too many projects than they could afford to complete every year, this notwithstanding, projects were more effectively delivered through local government than central government.
He said the findings were a demonstration of how administrative data could be valuable for policy preparation purposes as well as for academic work.
GBC News has learnt that the National Peace Council is taking steps towards resolving the various disagreements between the government and organized labour amicably in the current rising tensions among worker unions in the country.
The Council has already engaged with the labour unions to get them to reach an agreement with the government in the matter of the ongoing new Base Pay for public sector employees on the Single Spine Structure for 2023, the negotiation of which has stalled following a breakdown in the discussions.
The Executive Secretary at the Ashanti Regional Secretariat of the Peace Council, Reverend Emmanuel Badu Amoah, made this known to GBC News.
The intervention by the Peace Council, according to the Executive Secretary, is pursuant to the Council’s mandate to pre-empt for resolution as well as amicable management of potential or real conflict that could disturb the general peace, safety, security and stability of the country.
Touching on the recently announced government’s policy of the Debt Exchange Programme which has since ruffled feathers among the labour movement and other interested parties, Reverend Badu Amoah, assured that, the Council is not losing its guard in that matter and that there is an urgent need for all parties to appreciate the concerns of each other in the ultimate national interest.
Former Member of Parliament (MP) for Sunyani West Constituency, Hon. Kwadwo Adjei Darko has emphasized the need for presidents to reshuffle their ministers.
According to him, for a government to be more efficient, there is a need for reshuffling. “A minister may be good at a particular ministry; however, moving him from one ministry to the other will ensure efficient and effective governance.”
He said this in an interview with Suncity Radio, a Sunyani-based radio station in the Bono Region of Ghana, following a statement made by former President John Agyekum Kufour in an interaction with the Institute of Economic Affairs (IEA) at his residence in Peduase on Monday, December 5, 2022.
Mr. Adjei Darko added that the president has the right and authority to reshuffle his ministers. Meanwhile, there have been several calls from some Ghanaians for President Akufo-Addo to reshuffle his ministers.
However, the president insisted that he evaluates the work of his ministers consistently and that many of his appointees have discharged their duties excellently.
The Member of Parliament (MP) for Ningo-Prampram, Sam Nartey George, has commended the government for the construction of a road bridge over the Tema-Mpakadan railway, which passes through his constituency.
The MP, after thanking the government for the road bridge and resolving other issues that came up in the course of the construction of the Tema-Mpakadan railway, appeared to be mocking the president over the nature of roads in his constituency.
“My sincere gratitude to the Minister of Railways, Honourable John Peter Amewu, who has shown such great commitment to the people of Prampram.
“During the construction of this railway, there have been issues in the community at Afianya and Ablekuma, and the ministry has always responded expeditiously with the contractor whenever I have reached out to them.
“Mr president as I sit, once again our roads, please do something about it. Addo Show Boy show us something,” the MP said at the commissioning of the road bridge.
Watch the MP’s remarks below:
‘Addo Show Boy show us something’ – Sam George taunts Akufo-Addo
‘Addo Show Boy show us something’ – Sam George taunts Akufo-Addo
The Ghana Private Road Transport Union (GPTRU) has denied being responsible for the mountain of rubbish at the Tema Station lorry terminal near Ministries, the seat of government business, in the Greater Accra Region.
There has been a mountain of filth at the left wing of the lorry terminal near the Theodore Okoh Hockey Pitch.
According to the traders and the commercial drivers, the rubbish has sat in the area for the past couple of months.
The pile of filth emits a foul stench and has brought on an invasion of flies.
The traders say the rubbish is a result of the failure of the city authorities to periodically collect the filth after it has been dumped at the collection point in the area.
They are complaining that they pay daily tolls for the collection of rubbish in the terminal, adding that commercial drivers are also charged tolls at the gate for maintenance of the terminal but no true maintenance work is done.
Responding to the claims of the traders and commercial drivers, however, the Welfare Chairman of the GPRTU at the Tema Station terminal, Mr Kofi Afful, was categorical to say the union is not responsible for the collection of filth in the terminal.
He said the union used to be in charge of the collection of filth in the terminal but because of political expediency, some people went to the Assembly for the union’s contract with Jekora Ventures to be terminated.
Mr Afful exonerated the union from blame during an interview with the host of Ghana Yensom morning show, Odehyieba Kofi Essuman, on Accra 100.5 FM on Wednesday, December 7, 2022.
“After they have had the contract with Jekora Ventures terminated they have not been able to periodically collect the filth in the terminal,” he said.
He was blunt to say when the New Patriotic Party (NPP) government came to power, people rose to say their government had come to power and that some of these contracts should be given to them.
“So here we are, the contract was taken away from the union,” he lamented.
He sarcastically said a clinic has been built in the terminal for the people suffering as a result of the filth to seek treatment.
He revealed that there are about one thousand head porters living in the terminal.
“They do almost everything in the terminal,” he added.
“It is only in this country that we use politics to destroy initiatives that will help the ordinary person.
“Now you see what we are confronted with,” he said.
Finance expert, Joe Jackson, has asked the government of Ghana bondholders to accept the conditions of the debt exchange programme recently announced by the Minister for Finance, Ken Ofori-Atta.
The Government of Ghana on Sunday, December 4, 2022, announced a Debt Restructuring Programme asking institutional bondholders to voluntarily exchange their existing bonds for new ones.
The new agreement among other things, will replace existing local-currency debt with four new bonds maturing in 2027, 2029, 2032 and 2037; Finance Minister Ken Ofori-Atta said.
This has seen government entreat local bondholders to accept losses on interest payments set at 0% in 2023, 5% in 2024 and 10% from 2025.
Speaking on Ghana Tonight, Joe Jackson while noting that the exercise will have more impact on small investors asked the investors to accept the programme no matter how bad may be.
“At this moment, individuals who were wealthy enough to buy bonds in their own names are not being touched, Treasury Bills are not being touched. It is corporates that are being touched,” he said.
Describing the situation as unfortunate, Joe Jackson added that, “the smaller investor who is not rich enough to buy bonds in his name is now indirectly, being affected because that investor joined a corporate investment scheme, and the scheme being a corporate entity has been affected by the haircut.
“At this moment, you have got to accept it and move on however bitter the pill is, however unfair the pill is, however angry we feel about the pill,” he said.
The financial analyst however entreated the government to ensure cuts in its expenditure to help the current situation.
“The government must also cut expenditure , this is about cutting expenditure too. At the moment, I don’t think the government has cut enough expenditure. Next year’s budget we are still borrowing GHS61billion.
“That doesn’t make sense to me, that is not a nation in austerity. The government must cut expenditure, they must show that they are willing to bear the pain,” he stated.
Meanwhile, various institutional bondholders have flatly rejected the government’s debt exchange programme.
Parliament on Tuesday, December 6, 2022, approved the Budget and Economic Statement for Ghana for the 2023 financial year.
The budget was approved by the House after the conclusion of the debate on it by Members of Parliament (MPs).
After the brouhaha surrounding the budgets, with some MPs of the ruling government threatening to boycott it and other MPs being heavily criticised for missing the debate on it (the budget), it was passed without any aggression in the House.
But members of the minority caucus of Parliament could not help but mock their colleagues on the majority side over the poor performance of the economy.
Immediately, the Speaker of Parliament, Alban Bagbin, passed the motion for the approval of the budget after a voice vote, the National Democratic Congress MPs started singing Sidney Barima Oppong’s ‘Africa Money (Our Money)’.
‘Wanna money ee oga dey chop am nyafunyafu. Wonna money eh, ao money oh. Africa money eh, Oga dey chop am fuga fuga. Wonna money eh, ao money oh Africa money eh, Oga dey chop am fuga fuga. E dey chop am nyaga nyaga. Oga dey chop am nyafu nyafu, nyafu nyafu,” the MPs could be heard singing.
The song literally translates to African leaders using the resources of their countries (monies) for their personal benefit.
The government is aiming to put into place a long-term structure that would make it possible for low and middle-income earners in Ghana, notably public and civil servants, to obtain mortgages for their own homes.
This is provided for in the National Housing Policy before Cabinet for consideration, which when eventually enacted by Parliament, will allow the target population to use at least 30 percent of their monthly emolument to secure decent residential accommodation, particularly upon retirement.
The Minister of Works and Housing, Mr. Francis Asenso-Boakye, announced this at the Pemso Public Lecture in Kumasi.
This year’s Pemso Public Lecture is the seventh in its series and is focused on the ‘Asante Architecture; The Past and Present Perspective on Spatial Planning and Globalization’.
It was organized by the Asante Professionals Club, an apolitical not-for-profit organization under the auspices of the Manhyia Palace.
The President of the Club, Mrs. Ama Serwaa Nerquaye Tetteh explained that the Public Lecture series is part of the contributions of the Club towards meaningful national socio-economic development.
The lecture was delivered by a renowned Architect, Osei Kwame Agyemang, whose delivery traced the history of Asante traditional architectural designs in construction, particularly houses, in the context of a modern built environment.
With the aid of pictorial evidence, Osei Kwame Agyemang noted that unlike in modern construction, almost every building, particularly residential properties in the olden Asante system, had a courtyard designed with symbols that placed greater value on family cohesion, traditions, culture and discipline.
However, with the passage of time and the advancement of technology coupled with modernism and individualism, estate owners have now shifted to designs that virtually have no place for such values required to keep family history and traditions and suggested a re-look at the situation for the sake of posterity and history.
In a panel discussion, the discussant, a professor of Architect, Prof. Daniel Duah of the KNUST, a Legal Practitioner with expertise in land development, Mrs. Mariam Agyemang Gyasi Jawhary, and others, identified various factors that have led to the deviation from the old, but unique Asante Traditional Architectural designs which they noted was best in the preservation and promotion of family values, history and traditions for the larger society.
Head of the Asantehene’s Land Secretariat and the Apagyahene, Oheneba Owusu Afriyie, who is himself a professional Architect, while blaming successive government’s penchant for contracting foreign firms and individuals for the construction of public facilities without regard for Ghana’s historical and traditional interests, said, “it is not too late for the matter to be re-considered for the sake of Ghana’s future generations”.
The Minister of Works and Housing, Francis Asenso Boakye, said the recent Population and Housing census has put Ghana’s Housing deficit at one point-eight million, a figure which is about 200 thousand less than previously estimated.
The Minister identified the lack of a specific statutory body to lead the planning, coordination and regulation of the housing sector as the fundamental cause of the failure of various affordable housing initiatives, hence, the drafting of a law to establish the National Housing Authority in this regard.
Mr. Asenso-Boakye announced plans by the current government to ensure that public and civil servants acquire their own houses through a mortgage scheme.
The Asante Professionals Club used the event to recognize and honour three indigenes of Asante for their profound impactful contributions to national development.
They are Kwame Pianim, an Economist, Prof. Mrs. Rita Dickson, the first ever female Vice Chancellor of the KNUST and Dr. Charles Badu-Yeboah, co-founder and Managing Director of International Community School-Ghana.
According to the chamber, the proposal put forth by the Minister of Finance, Ken Ofori-Atta, is inferior to market expectation and will destroy the savings of Ghanaians and further undermine market confidence.
“We have carefully analysed the announcement by the Minister of Finance on the Debt Exchange Programme and are of the opinion that it is injurious to the interest of contributors to pension schemes”, it said in a statement.
“The proposal as put forth by the Minister of Finance is inferior to market expectation and will destroy the savings of Ghanaians and further undermine market confidence. This is why we reject it outright”, it explained.
It assured contributors to pension schemes that the industry has not agreed to the debt exchange programme proposed by the Ministry of Finance.
“As Trustees, we hold a fiduciary responsibility and are enjoined to seek the best interest of contributors at all times”, it stressed.
It further stated that though it recognises that inflation has caused significant harm to pension fund assets this year and that there is an urgent need to reduce the government debt burden and restore macroeconomic stability that should however not be done to the detriment of contributors to pension schemes.
“We share in Government’s call for burden sharing, but that should be done in the spirit of fairness to ensure a win-win outcome to all stakeholders”, the chamber added.
It urged contributors to pension funds and actors in the pensions industry to remain calm “as we seek the best outcome in our negotiations with the Ministry of Finance”.
“We will duly inform members of the outcome of our deliberations”, it concluded.
The minority has threatened to disapprove the 2023 budget estimates, and debt restructuring until some five conditions are met by government.
According to Haruna Iddrisu, they will not accept the debt restructuring programme announced by the finance minister.
This comes after Finance Minister Ken Ofori-Atta announced that Ghana is embarking on a debt exchange program to ensure that debt levels are brought to sustainable levels.
At a press conference, the minority leader said, “Let me state, without any fear of contradiction, that the form and structure of the debt restructuring plan announced by Ken Ofori-Atta are unacceptable to us, and we simply will not accept it.”
He also raised concerns over why the government failed to announce the exchange programme in the budget statement presented to parliament.
According to Haruna Iddrisu the minority are aware that “the Akufo-Addo/Bawumia government have become desperate and is compelled after reckless mismanagement of the economy to achieve fiscal consolidation.”
Below is a listicle of the conditions the minority has demanded before the budget estimates for 2023 will be approved;
1. The resignation of the entire Economic Management Team and in particular Alhaji Bawumia from his position as Chair of that obviously moribund body. 2. The immediate resignation or dismissal of the Finance Minister, Ken Ofori-Atta 3. Immediate reduction in the number of Ministers and political appointees at the Office of the President by half. 4. Removal of all non-essential expenditure in the 2023 budget including the GHC 80 million allocated to the National Cathedral
5. Reinstatement of the GHC100 exemption threshold for e-levy payment.
Following the above, the minority in parliament reiterated that the country’s ailing economy characterized by unsustainable debt, inflation, and unprecedented credit rating downgrades, among others.
Haruna Iddrisu explained the economic situation is so bad that Ghana is currently ranked side by side with Sri Lanka, which is considered the worst economy in the world and has defaulted on its debt.
Speaking at the press conference, he said “as it’s now trite knowledge, the Ghanaian economy has been terribly mismanaged in the last five to six years by the Akufo-Addo/Bawumia administration leading to our request for a 17th IMF program to renew confidence and policy credibility on our failing economy despite haughty initial denials.
“The severely ailing economy has been characterized by unsustainable debt, very high inflation, unprecedented and disastrous depreciation of the cedi, high budget deficits and unprecedented credit rating downgrades.
“The economic situation is so bad that we are currently ranked side by side with Sri Lanka, which is considered the worst economy in the world and has defaulted on its debt.”
The Government of Ghana and the Government of Germany have concluded bilateral negotiations on development cooperation in Berlin from 28th to 29th November 2022.
Ghana’s delegation was led by Ken Ofori-Atta, Minister for Finance; and included Osei Bonsu Amoah, MP and Deputy Minister for Local Government & Rural Development; Andrew Egyapa Mercer, MP and Deputy Minister for Energy; Gifty Twum Ampofo, MP and Deputy Minister for Education; and Ghana’s Ambassador to Germany, Ambassador Mrs. Gina Ama Blay.
The two-day negotiation was hosted by the German Federal Ministry for Economic Cooperation and Development (BMZ) with the support of allied agencies such as the Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH (GIZ) and KFW Development Bank.
At the end of the negotiations, the Government of Germany made new and additional grant commitments of EUR 82 million towards critical sectors of Ghana’s economy including renewable energy development, financial sector strengthening, education and skills development (TVET), digital transformation, governance, food security, female empowerment, and MSME support.
The Minister for Finance in his closing statement thanked Dr. Bärbel Kofler, Parliamentary State Secretary of the German Federal Ministry of Economic Cooperation and Development. He also described the grants as timely, given Ghana’s ongoing negotiations with the International Monetary Fund (IMF or the Fund).
In highlighting the significance of Development Bank Ghana (DBG), Mr Ofori-Atta stated that, “the support given us to set up what will be a real game changer in Ghana’s financial architecture, the Development Bank Ghana, is very commendable.”
He indicated that DBG has been positioned to play a countercyclical role in ensuring access to long term and affordable capital in challenging economic times, similar to KFW’s role during the post war reconstruction of Germany.
He assured that DBG would adhere to the highest corporate governance principles in order to ensure optimum shareholder value.
Speaking on behalf of Dr. Bärbel Kofler, Mr. Christoph Rauf, the Director for Africa at BMZ revealed that Ghana will continue to enjoy a “privilege partner” status with Germany, culminating in the development of a Special Partnership Arrangement with Ghana.
He also stated that Germany was committed to supporting Ghana’s arrangements with the IMF.
The next inter-governmental negotiations will take place in Accra in June 2023.
The Campaigner for EcoCare Ghana, Mrs. Patience Olesu-Adjei, has called on the government and key stakeholders to increase education on fire management within communities as the dry season nears.
According to her, this will ensure the protection of farms, the trees planted across the country during Green Ghana Day and other restoration projects aimed at restoring degraded forests as well as mitigating climate change.
She explained that bush fires release greenhouse gases into the atmosphere which contributes to climate change, whilst climate change makes the weather drier and warmer leading to longer active fires, therefore perpetuating a vicious cycle if actions are not taken to address the challenge.
Mrs. Olesu-Adjei made the call at a two-day training organized by EcoCare Ghana and Tropenbos Ghana in collaboration with the Ghana Fire Service.
The training aimed to equip members of the Landscape and Environmental Agility across the Nation (LEAN) Project Fire Volunteers Squad within the Transition Landscape with practical fire prevention and control skills.
She explained that the setting up of the Fire Volunteers Squad and the subsequent capacity building training for them was necessary because in the past two years, the LEAN project has supported farmers to plant over Four Hundred Thousand (400000) seedlings and given climate-smart agricultural training to farmers in the Sixty (60) projects communities.
Therefore, it is “imperative to train the farmers on fire management to protect the seedlings and their livelihood”.
She added that the Transition Landscape is a fire-prone area, especially during the dry season and therefore setting up Fire Volunteer Squads in communities to support the work of the Ghana Fire Service is timely and key in ensuring farmers’ livelihoods are protected to enhance food security and environmental sustainability.
During the training, the Bono East Fire Officer in charge of Rural Fires, DO3 Obed Boadi, pointed out that fires in the landscape are caused mostly by farmers, palm wine tappers, hunters, and Fulani herdsmen. He added that according to PNDC law 229 (Control and Prevention of Bushfires Act), “it is unlawful for any person to start any bushfires for any purpose” except “a person authorised by the Director of Agricultural Extension Services who may set fire for agricultural purposes”.
He cautioned that anyone who breaks the law is “liable on conviction to a fine of not less than two hundred and fifty penalty units and not more than one thousand penalty units or a term of imprisonment or community labour”.
He advised that citizens must report any bushfires they come across and failure to report without “justifiable reasons” is also an offence.
Mr. Samuel Yeboah, the Assemblyman for Techiman-Tanoso, a beneficiary of the training, was optimistic the training will be of tremendous help in saving their farmlands which have been subjected to perennial bushfires.
He advised his fellow volunteers to educate others, desist from actions that may cause bushfires and commit to supporting farmers in their locality when the need arises.
The Landscapes and Environmental Agility across the Nation (LEAN) is a four-year project funded by the European Union’s flagship GCA+ initiative that aims to conserve biodiversity, build climate resilience, reduce emissions from land-use changes and help smallholder farmers improve their livelihoods.
The project is being implemented in Ghana by a consortium of four partners; Rainforest Alliance in the High Forest Zone, World Vision Ghana in the Savannah and Tropenbos Ghana and EcoCare Ghana in the Transition Landscape respectively.
In total, about 190 Fire Volunteers have been trained from 15 communities out of 60 communities who are scheduled to receive the training within the Offinso Municipal and North, Techiman Municipal and North and Nkoranza Municipal and North District Assemblies.
The volunteers were taking through firefighting skills, fire detection, creation of fire belt and how to operate some basic firefighting equipment.
Government has allocated an amount of GH1.4 billion to the Contingency Vote in its 2023 budget statement and economic policy.
Per information from Member of Parliament for North Tongu, Samuel Okudzeto Ablakwa, the allocation to the Contingency Vote has increased by over GH400 million from GH993 million in 2022.
According to him, the allocation made at a time when the government has appealed to Ghana to burden share in an economy in crisis is “mind-boggling.”
“Significant and logical questions that arise are: why this astronomical increase in the Contingency Vote when putting priority concerns aside, a separate and legal allocation of GHS80million has this time been made for the Cathedral?
Should that not have led to substantial decreases in the Contingency allocation? What new scheme of create, loot and squander is brewing for which a record breaking GHS1.4billion Contingency is required?” the MP asked in a Facebook post.
Finance Minister, Ken Ofori-Atta informed the ad hoc committee instituted by Speaker Alban Bagbin to probe into a censure motion against him revealed that an amount of GHS339,003,064.86 was taken from the Contingency Vote to facilitate the construction of the National Cathedral project.
For Mr Ablakwa, it is unacceptable how money allocated to the Contingency Vote has skyrocketed since 2021.
Per the 2021 budget statement, an amount of GH186.2 million was allocated to the Contingency Vote.
Mr Ablakwa added that it is unacceptable that the recent allocation to the Contingency Vote significantly exceeds the budget allocation made to Parliament, Judiciary and a number of ministries.
“Let’s put the current GHS1.4billion in proper perspective — the amount is more than twice the entire 2023 allocation to Parliament which is some GHS645.8million; the scandalous Contingency Vote provision is also three times higher than the entire 2023 allocation to the Judiciary (including judicial service) which is GHS437.3million; the outrageous GHS1.4billion is also far higher than allocations to several ministries including National Security, Attorney General, Works and Housing, Communications, Railway Development, Chieftaincy, Employment, Transport, Fisheries, Lands and Natural Resources, Trade and Industry, Tourism, Environment, Energy, Foreign Affairs, Information and Parliamentary Affairs.”
Again, he was against the idea that the “insensitive” GHS1.4 billion Contingency Vote allocation “is higher than 14 out of Government’s 16 Flagship Initiatives.”
The monies allocated for government’s 16 flagship initiatives include; Roads Infrastructure (GH2,639,473,980), Free Senior High School Programme (GH2,957,502,092), Water and Sanitation Initiative (GH74,484,764), School Feeding Programme (GH969,000,000).
The others are; Planting for Food and Jobs (GH660,562,919), Railways Development (GH164,579,149), Infrastructure for Poverty Eradication Programme (GH526,573,888), Livelihood Empowerment Against Poverty (GH395,070,000).
The remaining initiatives are Nursing Trainee Allowances (GH265,200,000), Teacher Trainee Allowances (GH241,913,000), One District One Factory Programme (GH200,417,720), Regional Reorganisation and Development (GH38,800,000), National Identification Authority (GH37,600,000), Fish Landing Sites (GH26,304,000), Zongo Development Fund (GH24,409,600) and Micro Finance and Small Loans Centre (GH14,400,000).
The total cost for the initiatives is GH9,236,291,111.
The allocation made to the Contingency Vote, according to Mr Ablakwa, indicates that the government is not sincere about cutting their expenditure.
“They ought to be dealing with this Contingency Monster and not trivials such as hampers, diaries and workshops,” he suggested.
Government has directed public sector workers, Municipal Metropolitans and District Assemblies (MMDAs) not to give out hampers to their stakeholders this Christmas as part of efforts to cut down its expenditure.
“It beats my imagination that government has GHS1.4billion to spend in just one year as contingency, and yet refuses to use that money to employ the youth in critical sectors such as Education, Health and The Interior even as millions of jobless Ghanaians languish at home, particularly as unemployment has now reached an all-time high according to latest population census figures,” Mr Ablakwa further lamented.
The MP is of the assertion that “government is escalating on a grander scale instead of departing from its gross economic mismanagement and insatiable appetite for reckless expenditure which has created the current economic crisis, debt overhang, and the resultant painful and crude haircuts.”
Mr Ablakwa has therefore pledged that the Minority will resist the approval of the allocation to the Contingency Vote.
“This sleazy, sordid, shady, selfish and scandalous GHS1.4billion Contingency Vote allocation will only worsen ongoing labour agitations for better working conditions and lead to widespread justifiable refusal by the suffering Ghanaian people to burden share with a regime that is unhinged and irredeemable,” he concluded.
Government has started stakeholder engagement over the proposed construction of an airport to serve both the Central and Western regions.
The Central region currently has no functional commercial airport, while the military airport in Takoradi is used for scheduled commercial flights.
The decision to construct an airport for each region or one to serve both regions has gone through many phases. Ankaful was initially mooted as the possible location to site an airport for Central Region.
The Central region, which is a major tourism destination in the country, given its rich history and UNESCO World Heritage castles sited along the coast, is only accessible to tourists by road.
Connecting with the regional capital, Cape Coast, from Accra is hampered by heavy vehicular traffic. It takes about two (2) hours to connect from Accra on a typical weekend when many people usually travel for tourism and social events.
Cape Coast played a crucial role in the success of the Year of Return held in Ghana in 2019. Indeed a total of US$1.9 billion was generated into the economy through activities related to the “Year of Return.”
The programme also brought about an increase of over 200,000 in total arrivals into the country.
The Western Region is also one of the country’s most endowed areas and the oil hub. The region also hosts a lot of foreign companies operating in the mining, manufacturing and other sectors.
Presenting the 2023 Budget to Parliament, Finance Minister, Ken Ofori-Atta, gave the clearest indication that one airport will be constructed to serve both regions.
“Mr. Speaker, Phase II of Kumasi Airport Expansion Project is fully completed while Phase III is 89.33 percent complete. Additionally, a draft feasibility report on the Central/Western Region Airport was submitted and is being subjected to stakeholder engagement,” he said.
Commenting on the proposed airport, Sean Mendis, a commercial aviation expert, told AviationGhana exclusively that: “In general though, investment in aviation infrastructure is always a positive thing provided projects also are maintained well. Ghana already has a very robust culture of domestic air travel, and one of the highest number of per capita domestic travellers in sub-Saharan Africa.”
He added that the need for maintenance should be factored into the cost of the projects. “Airports are not build and forget projects unfortunately. They have to be maintained and operated at a professional standard to continue to be operational, so any investment needs to budget for that as well.”
Economic benefits of airports
A study by the International Air Transport Association (IATA) shows that the economic benefits of aviation investment are still large, and provide a strong justification for investment in the aviation industry.
The study found that for developing economies, the annual economic rates of return range from 16% to 28%.
“Developing countries face capital costs, especially for new aircraft, that are similar to those faced by developed countries. As such, though the boost to GDP is higher in proportional terms for developing economies, the capital costs are still high. Nevertheless, the available economic return is still large and provides a strong justification for investment in the aviation industry,” he said.
“There are significant and positive benefits generated by investment in aviation infrastructure and services, particularly in developing economies. By increasing a country’s connections to the global air transport network, investment in aviation can boost its long-term productivity and economic growth.”
“Greater aviation connectivity – and the improvements in productivity and GDP growth it can provide – can also help to boost a country’s competitiveness. By way of illustration, the World Economic Forum (WEF) has developed a Global Competitiveness Index for the travel and tourism sector.”
The WEF’s index incorporates many of the factors necessary to develop connectivity and create wider economic benefits in terms of productivity and economic growth.
There is a clear positive relationship between a country’s connectivity and its performance in the WEF index.
The Association of Road Contractors is lamenting government’s reluctance in settling debt owed them since 2018.
Members say the situation is really affecting their livelihoods and taking a toll on their health and businesses and rather frustrating.
Vice Chairman for the Association Stephen Atatsi while speaking on Akoma FM‘s weekend political show Wonsom, which was also telecast on Onua TV Saturday, December 3, revealed that most of their members are out of business and traumatized due to enormous financial burden on them as they took huge loans to execute government tasks (road projects).
The road contractors, who sounded disgruntled, told host of the show Aduanaba Kofi Asante Ennin that “since 2018, government hasn’t paid a penny to us and he owes us millions of dollars. The amount is as a result of delayed payment and accumulation of interest on certificates locked up at the sector ministry”.
Mr. Atatsi further lamented most of their members are hospitalized due to depression and frustration from persistent pressure from banks and other creditors.
He added that “some of the members are now living from hand to mouth because government has refused to pay huge amount of debt owed them. Some even cannot afford to buy their medical bills, so we are really going through a lot this is not fair”.
He expressed passionate grief about how unfairly government has been treating members of the Association of Road Contractors.
He further appealed to government to as matter of urgency come to their aid by paying up the four-year debt which is amounting to millions of dollars to salvage members of the Association and their families from excruciating situation they are faced with.
Senior Vice President of IMANI Africa, Kofi Bentil says the unrest in the labour sector is the doing of government.
The lawyer, who was speaking on the issue of disparity between Article 71 officeholders and Single-Spine workers, said the country has failed when it comes to “dealing with public sector wages over time”.
Speaking on JoyNews’ Newsfile, he said none of the problems caused can be attributed to public sector workers.
“Zero of the problems are with the public and civil servant. All the problems are with the leaders. When you employ somebody, the person’s wage is not a net loss to you because the person helps you to make more money than you pay them.”
“So if you take the civil and public servants, the government workers, whatever we’re paying them, if they were producing well enough, it will not be a net loss to you, it won’t be a problem, it will be a fraction of what they’re making,” he said.
Mr. Bentil argued that politicians and government officials are “messing up” the public sector.
He said proof of the above was the fact that workers from the public sector work efficiently when they are in the private sector than they do in the public sector.
“The public sector has about three times more qualifications than the private sector. And whenever they move, whether to international organizations or into the private sector, they produce massively. So why don’t they get the same levels of productivity when they’re in the civil and public service?
“It’s because of the leadership and the political messing up of that space. It’s because people are appointing political misfits into office. It is simply because the leadership there is poor at every level.”
He reiterated that the country should not blame the public sector workers for low productivity.
Public sector workers have been raising concerns over the huge gap between the salaries of Article 71 officeholders and Single-Spine workers.
By 2016, the difference between average salary earners of these two groups amounted to ₵17,088 with single spine workers taking as low as 1,128 as against Article 71 holder’s 18,211.
In view of this, organized labour recently rejected a proposal of 18% salary increment.
The group which consists of unions such as; GNAT, CLOGSAG and TUC stated that they will not accept any increment less than 60% although they are demanding a 65% increment.
The German government wants to stop energy companies from increasing electricity and gas prices in 2023, Bild newspaper reported Saturday, citing draft legislation.
The government has already ordered a cap on energy prices for next year to quell the energy crisis that threatens household budgets and the viability of many businesses.
What is the government planning?
A draft law on next year’s energy price brake, which was announced by Berlin last month, will also force utility companies to justify any increase in price, for example, extreme volatility in financial markets, Bild reported.
Otherwise, they would be banned from increasing prices in 2023.
The measure, if passed, would mean that hundreds of price increases already announced by energy firms for next year would have to be reversed.
The government wants to prevent energy firms from abusing an €83-billion ($87-billion) subsidy scheme to pay for the price cap.
The price rise justification will be part of the mechanism that firms will need to adhere to receive those subsidies.
“We want to prevent free-rider effects that encourage utility companies to charge higher tariffs,” Michael Kruse, spokesman for energy policy for the neoliberal Free Democratic Party (FDP) parliamentary group, told Bild.
Free riding occurs when one firm benefits from the actions and efforts of another without paying or sharing the costs.
Former President, John Mahama, has urged the government to prioritise agribusinesses and support key players in the agricultural value chain as a means to boost the economy.
According to him, in the face of recent downgrades by international rating agencies and the high inflation rate in the country, supporting the agricultural sector to reduce imports and strengthen the weakening cedi is the way to go.
He said this in a Facebook post to mark this year’s National Farmers’ Day celebrated on December 2.
“I celebrate all farmers on this auspicious occasion for their priceless efforts that feed us and keep our industries running.
“With Ghana’s economy at the brink of collapse, as proven by Rating Agencies through their unending downgrades, and the hardship it has brought to many homes, this is the time for government to begin to take farmers and farming related businesses serious,” he said.
He continued, “This is the surest way we can reduce imports, strengthen the struggling cedi and save Ghana’s economy.
“I urge government to prioritise agribusiness and support with favourable financing for farmers and all actors in the agricultural value chain.”
Meanwhile, Moody’s has downgraded the Government of Ghana’s long-term issuer ratings to Ca from Caa2 or further junk status and changed the outlook to stable.
This concludes the review for downgrade that was initiated on September 30, 2022.
“The Ca rating reflects Moody’s expectation that private creditors will likely incur substantial losses in the restructuring of both local and foreign currencies debts planned by the government as part of its 2023 budget proposed to Parliament on 24 November 2022″, a statement published on its website said..
The statement pointed out that “given Ghana’s high government debt burden and the debt structure, it is likely there will be substantial losses on both categories of debt in order for the government to meaningfully improve debt sustainability”.
Minority Leader Haruna Iddrisu has vowed to oppose the approval of budget estimates if the minister of the sector does not appear in the house alone.
According to him, some ministers have failed to show respect to the house, and there is a need to hold the government accountable.
“When we get to the approval of budget estimates and ministers don’t appear in person in parliament by themselves, we will not support the approval of the budget allocations to those ministries.
“Ministers must take this house very seriously, and only ministers appointed by the president to oversee the sectors of those ministries must rise from their seats to move motions to ask for budget allocations and approval by this house. Failure to do so will mean that we will stump down a number of those motions.
“We will hold this government accountable, and we intend to strengthen oversight. It begins with this our decision. If ministers don’t appear in person to move motions for budget allocations, then they should expect the fiercest resistance from this side of the house,” he explained.
Meanwhile, parliament has tasked the Ministry of Finance and other Ministries, Departments, and Agencies (MDAs) to submit their Heads of Estimates for consideration and approval by parliament on time.
Ghana has been downgraded deeper into junk territory by Moody’s Investors Service on the likelihood that private creditors will incur steep losses during the government’s planned debt restructuring.
The country’s credit rating was slashed by two levels to Ca, the second-lowest score at Moody’s, according to a Tuesday statement. That puts Ghana on par with Sri Lanka, which is in default.
The downgrade follows plans in Ghana’s proposed 2023 government budget to restructure both local and foreign debts.
“The Ca rating reflects Moody’s expectation that private creditors will likely incur substantial losses in the restructuring of both local and foreign currencies debts planned by the government as part of its 2023 budget proposed to Parliament on 24 November 2022. Given Ghana’s high government debt burden and the debt structure, it is likely there will be substantial losses on both categories of debt in order for the government to meaningfully improve debt sustainability,” analysts Lucie Villa and Marie Diron wrote in the statement.
At the same time, Ghana’s outlook was changed to stable as the restructuring will likely happen in coordination with creditors and under a program with the International Monetary Fund, according to Moody’s.
“The stable outlook balances Moody’s assumption that the debt restructuring will happen in coordination with creditors and under the umbrella of a funding program with the IMF against the potential for a less orderly form of default that could result in higher losses for private-sector creditors.”
The West African country formed a committee last month to start talks with domestic bondholders to restructure its local-currency debt.
Ghana’s Eurobonds have been among the worst performers in emerging markets since Bloomberg reported the plans for the local debt recast in September, handing investors losses of almost 12% in that period, according to data compiled from a Bloomberg index.
The nation’s debt-exchange program will replace existing terms and exchange debts with longer tenors at cheaper rates, said Abena Osei Asare, a deputy minister of finance. The plans come after an analysis of debt sustainability showed the nation faces a high risk of distress.
Fitch Ratings scored the nation at CC, two notches above default. S&P Global Ratings also assigned it CCC+, seven levels into junk.
Ghana has not imported maize for past five years due to the government’s continuous support to the sector, the deputy agriculture minister Yaw Frimpong Addo, has said.
Addo said over the period, the government has put in a lot to boost production of maize.
Appearing on The Asaase Breakfast Show on Tuesday (29 November) in Koforidua ahead of this year’s National Farmers’ Day celebration, Addo said the government is committed to ensuring food sufficiency in the country.
“Our duty as a ministry was to increase production which to a large extent we have succeeded. Since 2017, we haven’t imported a grain of maize into this country,” he said.
“There are several stages in agriculture that an investor can add value. For us, it’s the private sector that has to be encouraged to support us.
“There’s a close collaboration between the ministry and the researchers. There’s a lot of variety that we’re giving farmers to increase yields,” Addo said.
This year, the celebrations at the regional level have been restored as a cost-cutting strategy to ease the financial burden on the 16 regional coordinating councils, which hitherto bore the cost of travel expenses, accommodation and lodging of regional award winners and other accompanying officials to participate in the celebration at the national level.
There will be five regional award categories per region, namely: Regional Best Farmer; Regional Best Livestock Farmer; Regional Best Crop Farmer; Regional Best Fisher and Regional Best Agricultural Extension Agent.
The district award categories have been revised from six to three per district, namely: District Best Farmer; District Best Livestock Farmer and District Best Crop Farmer.
The districts that have the financial wherewithal to cater for additional award categories are, however, advised to do so at their own expense.
The Alliance for Social Equality and Public Accountability (ASEPA) has asked the government to rescind its decision to purchase oil from the world market using gold.
Instead, it called on the government to put in place measures to strengthen the local currency that had depreciated against the US dollar by 50 per cent this year.
Mr Mensah Thompson, Executive Director of ASEPA who made the call, said barter trading gold for oil would deplete the country’s forest reserve.
He said this while addressing a news conference on the 2023 Budget Statement and Economic Policy of the Government, in Accra, on Monday.
The government last week disclosed that it intends to purchase oil from the world market using gold instead of the dollar due to the depreciation of the Cedi against the US dollars.
Official data also shows that Ghana’s gross international reserves have fallen from $9.7 billion at the end of 2021 to around $6.6 billion at the end of September 2022.
Mr Thompson explained that gold was a commodity which had an extremely high price volatility on the world market and indicated that should the value of the commodity (gold) decline on the world market, government would require more gold to make the purchase.
“The sad situation about this is that Ghana has an oil refinery which has been abandoned since 2017.”
He added that: “The volatility of gold prices set another stage for the fast depletion of the mineral resources the country has if the prices of the commodity fall.”
Mr Mensah Thompson also urged the government to revise the 2.5 per cent VAT rate as maintaining the current rate would worsen the already precarious economic situation of Ghanaians.
He said: “Inflation is currently at 40.4 per cent, Producer Price Index sits at 61.7 per cent, the 2.5 per cent increase in VAT would skyrocket prices even further in such a precarious situation which would fuel inflation to unprecedented levels.
“In response to the skyrocketed inflation in 2023, the Central Bank would automatically increase the Policy Rate to curb inflation, this would worsen cost of borrowing in 2023, people would not be able to borrow due to the high interest costs, those who would be able to borrow risk falling into a debt trap, NPL sitting on the books of banks would skyrocket leading this country into a recession.”
He also emphasized the need for the government to cut down on expenditure to avoid incurring more debt.
The government, among other things, froze recruitment, purchasing vehicles and printing calendars to cut down on its expenditure.
The Speaker of Parliament, Alban Bagbin, wants the government to be open and candid with Ghanaians as its negotiation with the International Monetary Fund nears completion.
Mr. Bagbin said the government must bring all Ghanaians on board to find solutions to the challenges.
Speaking to journalists in Ho in the Volta Region, Mr. Bagbin said the Finance Ministry must show openness in all its dealings.
“The absence of openness and transparency can lead to suspicion and a profound sense of despair and hopelessness. It is in this regard that I call on the Minister of Finance to muster the courage to be candid, open and to speak truth to power,” he said.
“Don’t come and repeat what we have been told already, We know it. Give us policy alternatives,” Mr. Bagbin added.
Critics of the government have accused it of not being forthright about the country’s finances.
The opposition National Democratic Congress, for example, accused the government of fiscal recklessness and creative accounting as Ghana’s economic crisis took shape.
The government is currently seeking $3 billion from the International Monetary Fund to support the economy.
The government sought the International Monetary Fund’s support months after being urged by the opposition to do so amid worsening inflation and forex challenges.
Before going to the International Monetary Fund, the government had claimed it was on sound financial ground and did not need International Monetary Fund support.
The Secretary General of the Trades Union Congress (TUC) Dr Yaw Baah has said the congress does not have details of the government’s plan to freeze hiring next year as stated in the 2023 budget statement.
He said they do not know whether or not this forms part of the conditions the International Monetary Fund (IMF) is giving to Ghana.
Again, he said, they are unable to tell whether this is a net freeze or total.
Speaking in an interview with TV3’s Daniel Opoku on the sidelines of a post budget analyses forum held by the TUC in Accra on Monday November 28, Dr Yaw Baah said “we still don’t have the details of the IMF conditionality but you will not be wrong if you think this is part of IMF conditions. Since 1965 when Ghana Government started going to IMF, employment freeze has always been part, in the last one that ended, employment freeze was one but in that case it was net.
“Net meant that if somebody retires you can replace the person. So the net freeze is what we need. But this one, we don’t know the details, whether it is the net freeze or total freeze.
“If it is a net freeze then it is like the previous one but if it is a total freeze it is another ball game all together. There are 644,000 people on the single spine. Let us assume without admitting that about 5 per cent of them retire yearly.
“If only five percent retire every year, we are talking now about over 30,000 people retiring and if the 30,000 people retire and they don’t replace them it will affect service delivery. If you reduce numbers by over 30,000 and they are not replaced then your effectiveness in service delivery will be affected.”
The Minister of Finance Ken Ofori-Atta announced in the 2023 budget a freeze on employment into the civil and public service.
He also said there shall be no new government agencies established in 2023.
He said these while presenting the budget in Parliament on Thursday November 23.
Mr Ofori-Atta said as a first step toward expenditure rationalisation, government has approved a number of directives which takes effect from January, 2023.
These are “All Ministries, Departments and Agencies (MDAs), Metropolitan, Municipal and District Assemblies (MMDAs) and State-Owned-Enterprises (SOEs) are directed to reduce fuel allocations to Political Appointees and heads of MDAs, MMDAs and SOEs by 50%. This directive applies to all methods of fuel allocation including coupons, electronic cards, chit system, and fuel depots. Accordingly, 50% of the previous years (2022) budget allocation for fuel shall be earmarked for official business pertaining to MDAs, MMDAs and SOEs;
“A ban on the use of V8s/V6s or its equivalent except for cross country travel. All
government vehicles would be registered with GV green number plates from
January 2023; Limited budgetary allocation for the purchase of vehicles. For the avoidance of doubt, purchase of new vehicles shall be restricted to locally assembled vehicles;
“Only essential official foreign travel across government including SOEs shall be
allowed. No official foreign travel shall be allowed for board members.”
The Finance Minister added “Accordingly, all government institutions should submit a travel plan for the year 2023 by mid-December of all expected travels to the Chief of Staff; As far as possible, meetings and workshops should be done within the official environment or government facilities; Government sponsored external training and Staff Development activities at the Office of the President, Ministries and SOEs must be put on hold for the 2023 financial year; Reduction of expenditure on appointments including salary freezes together with suspension of certain allowances like housing, utilities and clothing, etc.;
“A freeze on new tax waivers for foreign companies and review of tax exemptions for free zone, mining, oil and gas companies; A hiring freeze for civil and public servants, No new government agencies shall be established in 2023; There shall be no hampers for 2022; There shall be no printing of diaries, notepads, calendars and other promotional, merchandise by MDAs, MMDAs and SOEs for 2024; All non-critical project must be suspended for 2023 Financial year.”
All large-scale gold mining firms in Ghana will, effective January 2023, have to sell 20% of their refined gold to the Bank of Ghana (BoG) before exporting.
This is to ensure that the government has enough gold to purchase petroleum products under the government’s gold for oil programme, which is also set to begin next year.
The government made this known in a letter addressed to the Minerals Commission and Precious Minerals Marketing Company (PMMC) dated
Wednesday, November 23, 2022.
“Effective 1 January 2023, all large- scale mining companies (as agreed with the Bank of Ghana) shall sell 20% of all refined gold at their refineries to the Bank of Ghana (in Ghana cedis) before the export of the gold. The Bank of Ghana and the Precious Minerals Marketing Company (PMMC) will coordinate with the large-scale mining companies to ensure compliance with this directive,” the letter said.
“Effective 1 January 2023, all Community Mining Schemes (CMS) shall sell their gold outputs to Government through PMMC. All mining licences for CMS shall include a clause mandating licensees to sell their gold output to government.
“Effective 1st January 2023, all Licensed Small-Scale Gold Miners shall sell their gold to government through PMMC. All small-scale gold
mining licences shall include a clause mandating licensees sell their gold to government,” the letter read.
When implemented, the policy will fundamentally alter Ghana’s balance of payments and may significantly reduce the cedi’s persistent depreciation.
The policy, which is still at the negotiation stage, is expected to come into force by the second quarter of 2023, according to the Vice-President Mahamudu Bawumia.
“The demand for foreign exchange by oil importers in the face of dwindling foreign exchange reserves results in the depreciation of the cedi and
increases in the cost of living with higher prices for fuel, transportation, utilities, etc.” he said.
He noted that, “to address this challenge, government is negotiating a new policy regime where our gold (rather than our US dollar reserves) will be used to buy oil products.
The barter of sustainably mined gold for oil is one of the most important economic policy changes in Ghana since independence.”
Government has defended its decision to privatise the Saglemi Housing Project.
According to the deputy Finance Minister, John Kumah, the decision is the best, given the current circumstances.
Speaking on Saturday, November 26, 2022, during Newsfile, he
explained that “the project is no longer affordable per the arrangement that has happened to it because if you divide $200 million by 10,000, you are going to get it at $10,000, and they reviewed it to 1,500 (housing units) which makes
it up (from) $40,000 to $50,000 per unit. So how affordable can
that be?”
“So in the present circumstances, the best option is to bring the
private sector in,” he said.
He, however, assured the citizenry that the government will be transparent in choosing a buyer.
The Saglemi Housing Project was initiated by the erstwhile Mahama Administration.
It was originally meant to be a 10,000 residential unit later
reviewed as a 5,000 unit facility to address the country’s housing
deficit.
However, after the Mahama administration left office, the project was abandoned and left to rot, despite various assurances by the current administration to complete it.
Government initially blamed its failure to complete it on lack of
financial resources.
In the latest development, the government, through the Works
and Housing Minister, Francis Asenso Boakye announced plans to privatise the project.
“Government has decided to – Explore the possibility of selling the Saglemi Housing Project, covering the 1,506 housing units, at the current value to a private sector entity to complete and sell the housing units to the public, at no further cost to the State,” Mr
Asenso-Boakye said at a press briefing in Accra.
“In furtherance of the above, and to facilitate the processes, a Technical Working Team has been set-up, comprising professionals and experts to oversee and spearhead all engagements required for the completion of the project.
This is being done with the goal of ensuring transparency and accountability, while guaranteeing value for money in the completion of the project,” he added.
Subsequently, the Minority in Parliament issued a caution to the
government to rescind its decision.
Minority Spokesperson for Works and Housing, Vincent Oppong
Asamoah argued that the project is viable therefore, “government should be compelled to look for funds to complete the project instead of privatisation.”
The minority in parliament has urged the government to seriously consider further lowering the e-levy rate to 0.5 percent and establishing a daily tax-free threshold of 300 cedis in order to gain their support.
Minority leader, Haruna Iddrisu, who made this appeal, noted that the minority caucus will vigorously advocate for the reduction in parliament.
Presenting the 2023 budget on Thursday, November 24, 2022, Finance Minister Ken Ofori-Atta announced that the government was reducing the e-levy rate
from 1.5 percent to 1 percent and removing the 100 cedis tax-free daily threshold.
That means any amount transferred is taxable. The Minority Leader, Haruna Iddrisu during the inaugural ceremony of the post Budget in Ho stated that such a review will worsen the hardship on the average Ghanaian.
Thus, he urged the government to reconsider the newly proposed rate and reduce it to a 0.5%“We will subject it to a further critical and thorough discussions
as a caucus but without going into the scenarios, as you look at your scenarios, consider for say of 0.5% at a threshold of ¢300 as compared to what you have admitted of 1%”.
Mr Haruna noted that his party had not yet made up its mind regarding the suggested increase of the VAT rate by 2.5 percent.
However, he cautioned that this can have a negative impact on businesses.
But according to Finance Minister Ken Ofori-Atta, the government’s inability to access the global market has made the measures crucial for raising domestic revenue.
He believes that these taxation policies are essential for saving Ghana’s economy from total collapse.
The Finance Minister has called on the MPs to rally their support for the measures suggested, so they can be passed on time. “It has become more urgent to
mobilise some domestic revenue as our access to the international market has been largely closed and our debt levels increased”,
Finance Minister, Ken Ofori- Atta had said on Thursday, November 24, during the 2023 budget presentation. The electronic transfer levy, popularly known as e-levy, was introduced in May 2022.
Ghana’s e-levy is a 1.5 per cent tax on the transfer amount of electronic transactions. The objective is to improve tax revenues by tapping into fast-growing digital financial services.
The Deputy Energy Minister, Dr Mohammed Amin Adam, says government is ready to implement its gold-for-oil barter deal.
According to him, the country has enough gold in its reserve to exchange for oil in order to reduce the current skyrocketing prices of fuel.
He made this disclosure while contributing to discussions on JoyNews’ The Probe on Sunday.
“Gold mobilisation and gold purchases are everyday activities. And so we have looked at the market and the Bank of Ghana is already buying gold and they are able to do 50,000 ounces of gold a month. The PMC [Precious Mining Company] also purchase gold from small-scale miners and they are able to buy 160,00 ounces every month. And what we need is 205,000 a month.
“And so if you look at our oil bill vis-à-vis the worth of the gold we are able to mobilize monthly, there is no doubt that we’ll be able to get the required gold to exchange for the requirement of our petroleum products and so we are very confident that this is a policy we can implement without difficulties,” he said.
Government on Thursday revealed that it is negotiating a gold-for-oil barter deal to address the country’s “dwindling foreign exchange reserves” to procure oil products.
Since Vice, President Mahamudu Bawumia announced this, many have wondered if the necessary consultation have been held.
Addressing the matter, Dr Adam said that prior to the announcement of this new policy, government had engaged all relevant stakeholders.
He stressed that it is therefore on the back of positive feedback that the government was confident it can embark on the policy.
“We have been engaging the Bank of Ghana and we also have been talking to oil suppliers. Those who have been supplying petroleum products to our country. We also have been engaging gold refiners and brokers.
“And so extensive discussions and engagements have taken place over the last one month and this is why at this point we can implement that policy, hence, the announcement,” he explained.
Vice-President Dr Mahamudu Bawumia has stated that some analysts and commentators have misinterpreted Ghana’s stated policy of using gold reserves to pay for oil as an attempt by Ghana to move away from the US dollar for international transactions.
Speaking at the 2022 AGI Awards in Accra, Dr Bawumia noted that on the contrary, Ghana’s gold for oil programme will give Ghana the space to accumulate more international reserves as the country will save the $3 billion it spends on oil imports.
He further stated that the use of gold was specifically for oil imports in the face of declining foreign exchange reserves.
“Unfortunately some people have misinterpreted this as Ghana being against the use of the US dollar in international transactions. Far from it. We want to accumulate more US dollar reserves in the future”, the Vice President noted.
Vice President Bawumia noted that a major source of cedi depreciation has been the demand for forex to finance our import of oil products and to address this challenge, Government, he said, is negotiating a new policy regime where sustainably mined gold will be used to buy oil products.
”If we implement the gold for oil policy as it as envisioned, it will fundamentally change our balance of payments and significantly reduce the persistent depreciation of our currency with its associated increases in fuel, electricity, water, transport and food prices.”
This, he noted, is because the exchange rate (spot or forward) will no longer directly enter the formula for the determination of fuel or utility prices since all the domestic sellers of fuel will no longer need foreign exchange to import oil products,” Dr. Bawumia said.
This, he claimed, would support revenue mobilisation for economic development and aid in integrating the underprivileged and the disadvantaged into the financial ecosystem.
The daily transaction of GHC 100 is free from the levy, which went into effect in May 2022 and has a 1.5 percent charge on MoMo payments, bank transfers, merchant payments, and inward remittances.
But, during the 2023 budget reading on Thursday, the Government announced that it would reduce the E-Levy rate from 1.5 percent to one percent, effective 2023, and remove the GH¢100 daily threshold on the tax.
Prof Amoah, in an interview with the Ghana News Agency on Friday, lauded the Government for listening to Ghanaians by reducing the rate on the levy from 1.5 percent to one percent.
He described the move to reduce the tax rate to one percent as a good attempt to block the loopholes in the tax handle.
He said, such a situation, would affect the Government’s revenue mobilisation and financial inclusion drive, and urged that a consideration was given to the removal of the threshold.
Prof Amoah said: “What people are now to do is to use the transport system and give money to people to be given to recipients, and that’s the alternative the poor are going to use, knowing the E-levy will bite them hard.”
“This is not a good way to go, especially around this time where we’re trying our best to resuscitate economic activities to drive growth.” Prof Amoah, who is the Acting Dean of the School of Sustainable Development at the University of Environment and Sustainable Development, said.
He asked the Government to conduct a thorough research to identify and target people who did larger volumes of transactions yet evading the levy instead of those it was trying to add to the financial inclusion ecosystem.
“In this world, without financial inclusion, poverty cannot be eradicated. So, if you’re serious about the Sustainable Development Goal (SDG) of eradicating poverty, then financial inclusion is key.” Prof Amoah said.
Recent research by the Centre for Economics, Finance, and Inequality Studies (CEFIS), showed that many Ghanaians have been avoiding the payment of tax on electronic transactions above GHS100 because of the 1.5 per cent charge.
The situation led MoMo merchants (whose number has been increasing) to “milk” the Government of expected revenue from the E-levy – as merchants negotiate with customers for a fee, making customers avoid the payment of tax.
Some MoMo merchants in Accra who have spoken to GNA on this development confirmed that they had entered into such agreements, making customers avoid paying taxes, especially on transactions amounting to GH¢1,000 and above
The 2021 Bank of Ghana (BoG) Payment Systems Oversight Annual Report noted that the total number of active mobile money customers increased by 2.4 percent year-on-year, as against a 29 percent growth in the number of active mobile money agents growing.
Government says it is yet to conclude technical works on the country’s possible debt operations following engagements with the International Monetary Fund (IMF).
The Ministry of Finance in a statement issued on Thursday, November 24, 2022, shortly after the presentation of the 2023 Budget by the sector minister emphasizes, “terms of principal payments and interest on the public debt are still being discussed”.
This clarification comes on the heels of some media reports suggesting that government intends to put interest payments for domestic bondholders on hold and rather introduce some haircuts on international bonds.
The widespread publications point to debt restructuring that will impose a 30 percent haircut on both the principal and interest of foreign bonds while individuals with local bonds will begin receiving interest in full from 2026 after receiving zero, five and 10 percent of interest in 2023, 2024 and 2025 respectively with the principal going untouched.
But the statement from the Finance Ministry maintains that, no such arrangements have been finalized because discussions are still being held.
“Details of the different layers of a debt operation, including the terms of principal payments and interest on the public debt are still being discussed, taking into account recipes of debt. Sustainability and International set practices”, the release read in parts.
“All measures will be communicated by the Ministry of Finance in due course”, it further continued.
Finance Minister, Ken Ofori-Atta during the presentation of government’s economic policy and budget statement for the next fiscal year beginning January 2023 told Parliament, government is considering a debt operation aimed at restoring the country’s debt sustainability and reducing pressures on the national budget.
This he said would also open up financing streams and provide needed balance of payment support from the IMF.
Currently, Ghana is at the doors of the International Monetary Fund institution seeking a US$ 3 billion bailout after a worsening economic situation and cost of living crisis.
Government says it has reached agreed programme objectives with the Fund for the support.
The move has raised issues of possible haircut on some investments as part of debt restructuring measures, despite assurances by President Akufo-Addo that government does not intend to slash the returns made on investments in its negotiations.
“Government of Ghana reiterates its commitment to rolling out a lasting solution to the current economic challenges with the ultimate goal of restoring macroeconomic stability and anchoring debt analysis”, the Finance Ministry concluded in its statement.
The government of Ghana has announced some austerity measures in the 2023 budget.
The Finance Minister, Ken Ofori-Atta has announced a ban on employment for civil servants effective January 2023.
Finance Minister Ken Ofori-Atta told parliament on Thursday, 24 November 2022: “Mr. Speaker, as a first step toward expenditure rationalisation, the Government has approved the following directives which take effect from January 2023: All MDAs, MMDAs and SOEs are directed to reduce fuel allocations to political appointees and heads of MDAs, MMDAs and SOEs by 50%”.
“This directive applies to all methods of fuel allocation including coupons, electronic cards, chit system, and fuel depots”, he clarified.
“Accordingly, 50% of the previous year’s (2022) budget allocation for fuel shall be earmarked for official business pertaining to MDAs, MMDAs and SOEs”, the minister noted.
Also, he announced “a ban on the use of V8s/V6s or its equivalent except for cross-country travel”.
“All government vehicles would be registered with GV green number plates from January 2023”.
Further, there would be “limited budgetary allocation for the purchase of vehicles”.
“For the avoidance of doubt, the purchase of new vehicles shall be restricted to locally assembled vehicles”, the minister noted.
“Only essential official foreign travel across government, including SOEs shall be allowed. No official foreign travel shall be allowed for board members”.
“Accordingly, all government institutions should submit a travel plan for the year 2023 by mid-December of all expected travels to the Chief of Staff”.
“As far as possible, meetings and workshops should be done within the official environment or government facilities”.
“Government-sponsored external training and staff development activities at the office of the president, ministries and SOEs must be put on hold for the 2023 financial year”.
Also, the minister announced a “reduction of expenditure on appointments including salary freezes together with suspension of certain allowances like housing, utilities and clothing, etc”.
“A freeze on new tax waivers for foreign companies and review of tax exemptions for free zone, mining, oil and gas companies”.
“A hiring freeze for civil and public servants. No new government agencies shall be established in 2023”, he added.
Additionally, “there shall be no hampers for 2022”.
2023 BUDGET STATEMENT 1
2023 BUDGET SPEECH
Introduction 1.
Right Honourable Speaker, Honourable Members of Parliament, on the authority of the President of the Republic of Ghana, and in accordance with the requirement under Article 179 of the 1992 Constitution of the Republic of Ghana, I present to you the 2023 Budget Statement and Economic Policy of His Excellency Nana Addo Dankwa Akufo-Addo.
2. Mr. Speaker, I beg to move that this House approves the Budget Statement and Economic Policy of the Government of Ghana for the year ending 31st December, 2023.
3. I also respectfully submit to this House the following statutory reports:
● The 2022 Annual Report on the Petroleum Funds, pursuant to Section 48 of the Petroleum Revenue Management Act, 2011 (Act 815), (as amended); and
● The 2022 Report on the Utilisation of the African Union Levies, pursuant to Section 7 of the African Union Import Levies Act, 2017 (Act 952).
4. Mr. Speaker, this Budget Speech is an abridged version of the 2023 Budget Statement and Economic Policy of Government.
I request the Hansard Department to capture the entire Budget Statement and Economic Policy of Government for the year ending 31st December, 2023.
5. Mr. Speaker, at the outset, permit me to thank you, personally, the leadership of Parliament, Honourable Members of this august House for your individual and collective support, understanding and cooperation the past six years that I have had the honour and privilege to be the Minister responsible for Finance.
6. As we all are fully aware, a lot has happened this year in the economy and more so in recent weeks over my role in the management of the economy.
These are very erratic times and, on behalf of the President of the Republic and, for myself in particular, I am eternally grateful, first, to the leadership of the New Patriotic Party, and the majority leadership and caucus of this House.
And, to the Minority caucus of the National Democratic Congress in Parliament, I thank you, on your decision yesterday to participate fully in the process of passing this budget and, to quote, you stressed how “also mindful” you are “of the timeliness regarding the IMF negotiations and the crucial role a timely presentation of the 2023 budget will play in the advancement” of Ghana’s case in the negotiations with the Fund.
7. I wish to assure this House of my strong commitment and unflinching cooperation in our collective efforts to secure an historic IMF programme very soon; a programme that will assist the country in its post-covid recovery efforts.
Our disagreements notwithstanding, what should never be in doubt, especially in the eyes and ears of the general public, is our common desire to serve the Republic. Our democracy is richer for it.
Let me quote Simón Bolíva;
“In the unity of our nations rests the glorious future of our peoples.”.
8. But Mr. Speaker, The President of the Republic who is in Qatar enjoins us to remember Nehemiah when he said ‘Let us rebuilt the walls of Jerusalem and we will in disgrace.
They replied “Let is start rebuilding”. So they began to work.
9. Mr. Speaker, the year 2022 will go down as one of the most difficult and eventful years in the economic history of our country.
While we continue to deal with the devastating impact of the COVID-19 pandemic which led to significant reduction in our revenues and increased our expenditures enormously, we also have had to contend with the double jeopardy of the Russian-Ukraine war.
What has resulted in unprecedented global crises ravaging all currencies and historic living and inflation levels
10. In the midst of these really challenging times, Parliament has in many, many instances supported Government’s programmes presented to this House.
The eventual passage of the E-levy Act, the Fees and Charges Act, the Exemptions Act and the US$750 million Afrexim Loan, among others, attest to the support received from this august House.
At the same time, the exceptional challenges that the Electronic Levy bill encountered months before it was passed, also attest to the challenges that we must be mindful of going forward.
11. Mr. Speaker, I also wish to express the deep appreciation of Government to the various stakeholders, including Employers’ Associations, Labour Unions, Civil Society, Faith-Based Organizations, Association of Ghana Industries, Ghana Union of Traders Association, Bankers, Academia and Think-Tanks for the support we have received throughout the year, as well as the inputs that have informed and enriched our policy choices. It is, Mr Speaker, when God’s people live together in unity- the Lord bestows His blessings.
A CHALLENGING YEAR
Mr. Speaker, a year ago, I came to present a Budget with significant revenue measures to tackle our fiscal difficulties, finance the transformative agenda of Government and sustain the post COVID-19 recovery. However, what started as a political disagreement over revenue measures in this House, triggered a series of events that significantly undermined the credibility of our budget, consequently leading to serious economic challenges, as investor confidence hit a new low.
13. This manifested in credit rating downgrades which triggered the closure of Ghana’s access to the International Capital Market; tightening domestic financing conditions; and increasing cost of borrowing.
The combined effects of the developments contributed to the rapid depreciation of the cedi and compounded the high debt service levels.
14. Mr. Speaker, our inability to access the International Capital Markets meant that, for the first time in our administration, we did not have the needed foreign currency to complement our forex earnings. ]
We have had to make strenuous efforts to meet our import bill, which exceeds US$10.0 billion annually.
Considering our low foreign earnings, it has been difficult to meet our import requirements including crude oil and petroleum products of about US$400m (GHc4.80 billion) a month.
At the same time, Ministry of Finance still needs to find about US$1.0 billion annually to keep our lights in our homes and workplaces.
15. Mr. Speaker, the demand for foreign exchange to support our unbridled demand for imports undermines and weakens the value of the cedi.
This contributed to the depreciation of the cedi, which has lost about 53.8 percent of its value since the beginning of the year.
Compared to the average 7 percent average annual depreciation of the Cedi between 2017 and 2021, the current year’s depreciation, which is driving the high costs of goods and services for everyone, is clearly an aberration – a very expensive one.
16. The increases in fuel prices (Diesel currently GHS20.5 and Petrol GHS16.8) has led to increases in prices of most goods and services.
Inflation which we managed to bring down from 15.4 percent at the end of 2016 to 7.9 percent at the end of 2019 and remained in single digits till the pandemic hit in March 2020 is now 40.4 percent.
17. It is not only the individuals and households who are adversely affected by the depreciation of the cedi. For us at the Ministry of Finance, the depreciation of the cedi seriously affects our ability to effectively manage our debt.
Indeed, our stock of debt has increased by GHc93 billion this year alone due to the depreciation of the cedi since the beginning of 2022.
Even as the State struggles to raise sufficient revenues, high inflation rates continue to eat away the already meagre wages of the average Ghanaian.
The lesson from this relapse in macro-economic stability makes us even more determined, as your government, to permanently restructure and transform this economy and build resilience.
18. Mr. Speaker, we have been honest with Ghanaians about the economic challenges that the country is facing. H.E. The President pointed out that, never have so many malevolent forces come together, in a perfect storm, to so dramatically impact our lives. The current challenges on the back of two difficult years, since March 2020, have really tested our people and our resolve.
We empathize greatly with all Ghanaians for the undue pressures this has placed on their livelihoods.
We want to commend all of you for your forbearance during these difficult times.
We are confident that together, and with God on our side, we will turn things around.
19. On behalf of His Excellency the President, let me assure all Ghanaians that Government is working to change this negative narrative and demonstrate our resilience as a people and our ability to rebuild for a better future.
We have demonstrated this many times in our country, but more recently between 2017 and 2019. We are resolved that in the next two years, Government would work with you all, with a restless determination, to turn around this economy.
20. Mr. Speaker, in a few hours, the Black Stars will be playing their first game in the 2022 FIFA World Cup tournament in Qatar.
It is clear that we stand united as a nation behind our Black Stars.
A successful passage of the 2023 budget, a successful conclusion of negotiations with the IMF; and, making Ghana’s performance in Qatar 2022, the most successful that is winning the Cup not only for the country but for any African side on the World Cup stage, will, I dare say, bring this most challenging year to a very successful end.
To this, Mr Speaker, we pray. As the bible says ‘behold How good and pleasant it is when God’s people live together in unity! ……… for there, the Lord commands the blessing” Psalm 133 verse 1-3 Resetting Our Economy
21. Mr. Speaker, events since March 2020 have taught us the pervasive volatility of our world today and the wisdom in the vision of President Akufo-Addo to reset our economy through industrialisation.
This budget reflects our resolve to reset the economy and restore macroeconomic stability. But, to do so, we need the support of the people of Ghana and the cooperation and approval of this Parliament.
Our goal now is to significantly enhance revenues, significantly cut down the cost of running government, significantly expand local production, invest more to protect the poor and vulnerable, continue expanding access to good roads, education and health for every Ghanaian everywhere in Ghana and the diaspora.
22. Mr. Speaker, this Budget is, therefore, anchored on a seven-point agenda aimed at restoring macro-economic stability and accelerating our economic transformation as articulated in the Post-COVID-19 Programme for Economic Growth (PC-PEG).
These comprise an agenda to:
i. Aggressively mobilize domestic revenue;
ii. Streamline and rationalise expenditures; iii. Boost local productive capacity;
iv. Promote and diversify exports;
v. Protect the poor and vulnerable;
vi. Expand digital and climate-responsive physical infrastructure; and
vii. Implement structural and public sector reforms.
23. To achieve these, there are three (3) critical imperatives: successfully negotiating a strong IMF programme; coordinating an equitable debt operation programme; and attracting significant green investments.
This will enable us to generate substantial revenue, create needed fiscal space for the provision of essential public services and facilitate the implementation of the PC-PEG programme to revitalise and transform the economy.
24. Mr. Speaker, we will undertake the following actions, initiatives, and interventions under the seven-point agenda.
● To aggressively mobilize domestic revenue, we will among others:
Increase the VAT rate by 2.5 percent to directly support our roads and digitalization agenda; Fast-track the implementation of the Unified Property Rate Platform programme in 2023; and
Review the E-Levy Act and more specifically, reduce the headline rate from 1.5% to one percent (1%) of the transaction value as well as the removal of the daily threshold.
● To boost local productive capacity, we will among others:
cut the imports of public sector institutions that rely on imports either for inputs or consumption by 50% and will work with the Ghana Audit Service and the Internal Audit Agency to ensure compliance;
support the aggressive production of strategic substitutes, including the list disclosed at the President’s last address to the nation;
Support large-scale agriculture and agribusinesses interventions through the Development Bank Ghana and ADB Bank;
introduce policies for the protection and incubation newly formed domestic industries to allow them to make the goods produced here competitive for local consumption and also for exports.
● To promote exports, we will among others: ○ expand our productive capacity in the real sector of the economy and actively encourage the consumption of locally produced rice, poultry, vegetable oil and fruit juices, ceramic tiles among others;
● To pursue efficiency in Government expenditures, we will among others:
Implement the Government directives on expenditure measures;
Integrate public procurement approval processes with GIFMIS to ensure that projects approved are aligned with budget allocation;
Review key government programmes to reflect relevance, promote efficiency, and ensure value for money; and ○ Review the efficiency of Statutory Funds
● To implement structural and public sector reform, we will among others:
Impose a debt limit on non-concessional financing;
Undertake major structural reforms in the Public Sector by reviewing the operations of 36 State-owned Enterprises, 8 Special Purpose Vehicles, 90 Joint Venture Companies, 38 Regulatory institutions, 68 Statutory Bodies and 6 Subvented Agencies;
Enforce compliance with legal and regulatory framework on foreign exchange; ○ Initiate measures to overhaul the tax structures in the extractive industry;
Expand the gold purchase programme by Bank of Ghana to support FX Reserve accumulation, promote an LBMA certified gold refinery in Ghana and promote local currency stability;
● To safeguard the social protection programmes, we will among others: Expand social protection programmes such as LEAP, School Feeding, and NHIS for the vulnerable and socially excluded.
25. Mr. Speaker, last year, I presented our plan to get us back to pre-pandemic macrostability and growth levels. More importantly, I shared the President’s strategy to improve the living standards of Ghanaians and address our central challenge – unemployment.
The strategy was anchored on building a Sustainable Entrepreneurial Nation through fiscal consolidation and Job Creation.
I am happy to report that we have piloted the YouStart Programme and launched the District Level programme.
2023 BUDGET STATEMENT 9
26. Mr. Speaker, we now have the commitment of our banks and development partners and are confident that the GHS10 billion, 1 million jobs will be achieved in the next three (3) years.
27. We are now embarking on a journey to fundamentally reposition our economy with the Post-COVID-19 Programme for Economic Growth (PC-PEG), to be supported by the IMF, World Bank and other friendly sovereigns and the private sector (domestic and international), as our blueprint.
We are mindful that it will require broad-based contributions and sacrifices.
There will be costs to the fiscal adjustments we intend to make in the coming years to sustain our stability, recovery and eventual transformation.
My pledge to this House is that there will be fiscal discipline.
That every pesewa that we ask the Ghanaian people and businesses operating in Ghana to contribute will be spent well.
28. The challenges we face are daunting but we must not lose sight of the greatest strength of being Ghanaian: resilience, entrepreneurial zeal, faith, courage, solidarity and hope.
I, therefore, ask all of us to play a constructive role in getting our nation fully back on track. Ours is a country with real prospects and the challenges notwithstanding, Ghana will rise again, and my faith is premised on the fact that a lot has already been achieved, especially over the course of the Fourth Republic and our policy, as outlined in this budget to reset the economy, if supported will ensure that, indeed, we have not wasted the current global crisis, but used it to make our economy stronger and the progress and prosperity of our people even more assured.
SECTION 2:
GLOBAL ECONOMIC DEVELOPMENTS AND OUTLOOK
Economic Growth and Inflation 29. Mr. Speaker, the global environment is fragile, and the outlook remains uncertain.
Global economic activity in 2022, has slowed down more broadly and sharply than anticipated. Economic growth in Emerging Markets and Developing Economies is expected to slow down from 6.7 percent in 2021 to 3.7 percent in 2022, with a similar pattern expected in 2023.
In Sub-Saharan Africa, growth is expected to slow down to 3.6 percent in 2022 and 3.7 percent in 2023, from 4.7 percent in 2021 due to low investment and a worsening trade balance.
30. Overall, global inflation has risen, driven largely by increases in energy and food prices. Inflation in Emerging and Developing Economies has also risen from an average 5.9 percent in 2021 to 9.9 percent in 2022.
The war in Ukraine has further heightened inflationary pressures.
31. The exchange rates across the major international currencies depreciated rapidly by the end of the third quarter of 2022.
As at 23rd November, 2022, the Ghana cedi depreciated cumulatively by 54.2 percent against the US Dollar. Similarly, the Ghana cedi depreciated cumulatively by a 48.5 percent against the British Pound.
Overview of Macroeconomic Performance (Jan-Sep. 2022)
32. Mr. Speaker, I now present to this august House the provisional macroeconomic performance for the first three quarters of 2022 based on available data for the period.
33. To better assess the macroeconomic developments for the first three quarters of the year, permit me to restate the macroeconomic targets set for 2022 as presented in the 2022 Mid-Year Fiscal Policy Review: Overall Real GDP growth of 3.7 percent;
Non-Oil Real GDP Growth rate of 4.3 percent; End-period inflation of 28.5 percent; Overall fiscal deficit of 6.6 percent of GDP; Primary surplus of 0.4 percent of GDP; and Gross International Reserves sufficient to cover at least three and half months of imports of goods and services.
34. Mr. Speaker, data on the performance of the economy at the end of the third quarter highlights the continued adverse impact of the challenging global and domestic environment on the economy.
As I indicated earlier, these developments have manifested through rapid exchange rate depreciation, high inflation, unsustainable debt burden, fiscal stress and external sector shocks, among others, despite the monetary and fiscal policy interventions that were deployed in the first three quarters of the year.
35. Mr. Speaker, the economic performance for the first three quarters of the year is summarised as follows:
36. Mr. Speaker, provisional GDP data from Ghana Statistical Service (GSS) published in September 2022 indicate that overall Real GDP for the first half of 2022 recorded an average year-on-year growth of 4.0 percent (3.4 percent in Q1 2022 and 4.8 percent in Q2 2022 respectively).
Non-Oil GDP expanded by 4.1 percent and 6.2 percent in the first and second quarters in 2022, respectively.
The latest data indicates that headline inflation accelerated to 40.4 percent in October 2022, from 37. 2 percent in September and 33.9 percent in August.
The rise in the October inflation was broad-based, driven by both food and nonfood prices.
The Monetary Policy Rate has increased by 1,000 basis points (from 14.5% to 24.5%) since the beginning year as the Central Bank deployed its monetary policy tools to anchor inflation expectations;
Developments on the money market broadly showed rising interest rates across the yield curve.
For example, the discount rate on the 91-day instrument has increased to 32.5 percent as at today from 12.5 percent in December 2021;
The Public Debt-to-GDP ratio stood at 75.9 percent at the end of September 2022, up from 76.7 percent at the end of December 2021.
Gross International Reserves (GIR) stood at US$6,591.8 million, equivalent to 2.9 months of imports cover, at the end of September 2022 from a stock position of US$9,695.2 million (equivalent to 4.3 months imports cover) at the end of December 2021.
Fiscal Developments Summary of Fiscal Performance Q1-Q3 2022
37. Mr. Speaker, the 2022 Mid-Year Fiscal Policy Review revised the 2022 fiscal framework against the backdrop of unfavourable global and domestic developments.
The fiscal deficit target was revised to 6.6 percent of GDP down from the 7.4 percent set in the 2022 Budget.
Similarly, the primary balance target was revised upwards to a surplus of 0.4 percent of GDP from a surplus of 0.1 percent.
38. This was on the back of revisions in GDP projections, adjustment in the expected yield from the 2022 revenue measures, adjustments to reflect the 30 percent discretionary expenditure cuts, adjustment in interest payments, and adjustments in the allocation for compensation of employees to incorporate a 15 percent Cost of Living Allowance (COLA), adjustment in exchange rate on account of higher depreciation, and adjustment to the Benchmark Crude oil price.
39. Mr. Speaker, provisional data on Government fiscal operations for January – September 2022 shows a shortfall in revenue performance and a faster execution of expenditures.
This resulted in an overall budget deficit of GH¢41,699 million (7.0% of GDP), against a programmed deficit target of GH¢36,684 million (6.2% of GDP).
The corresponding primary balance for the period was a deficit of GH¢9,597 million (1.6% of GDP), against a deficit target of GH¢5,794 million (1.0% of GDP).
Revenue Performance
40. Mr. Speaker, Total Revenue and Grants amounted to GH¢65,399 million (11.0 percent of GDP), compared with a target of GH¢67,307 (11.4 percent of GDP) and the GH¢49,108 million (10.7 percent of GDP) recorded in the corresponding period in 2021.
The outturn for Total Revenue and Grants represents a shortfall of 2.8 percent compared to the period’s target and year-on-year growth of 33.2 percent.
The shortfall in revenue stemmed from the less robust performance recorded in all the revenue handles for the period.
41. Mr. Speaker, Domestic Revenue for the period amounted to GH¢64,601million (10.9 percent of GDP), falling below the target of GH¢66,503 million (11.2 percent of GDP) by 2.9 percent.
The outturn, however, represents a year-on-year growth of 34.0 percent and constituted 98.8 percent of Total Revenue and Grants.
Expenditure Performance
42. Mr. Speaker, Total Expenditure (including arrears clearance and discrepancy) for the period amounted to GH¢109,421 million (18.5 percent of GDP), above the target 2023 BUDGET STATEMENT
14 of GH¢103,992 million (17.6 percent of GDP) by 5.2 percent. Compensation of Employees amounted to GH¢27,146 million (4.6 percent of GDP), 2.9 percent below the budgetary provision of GH¢27,947 million (4.7 percent of GDP).
The Wage bill constituted 91.3 percent of the total Compensation and amounted to GH¢24,734 million.
43. Interest Payments for the period amounted to GH¢32,101 million (5.4 percent of GDP), against the target of GH¢30,890 million (5.2 percent of GDP) reflecting the higher cost of borrowing and the adverse impact of the currency depreciation on external interest.
Domestic Interest Payments constituted 78 percent of total Interest Payments for the period. Financing Operations
44. Mr. Speaker, the fiscal operations for the period resulted in an overall budget deficit of GH¢44,022 million (7.4% of GDP), against a target of GH¢36,684 million (6.2% of GDP).
The corresponding primary balance for the period was a deficit of GH¢11,921 million (2.0% of GDP), against a deficit target of GH¢5,794 (1.0% of GDP).
45. The fiscal deficit for the period was financed mainly from domestic sources amounting to GH¢37,491 million (6.3% of GDP), accounting for 85.2 percent of the total financing.
Foreign financing for the period amounted to GH¢6,531 million (1.1% of GDP) and accounted for the remaining 14.8 percent of the financing.
Public Debt Developments for January – September 2022
46. Mr. Speaker, provisional debt data as at end September 2022 shows a significant increase in Ghana’s public debt largely due to exogeneous factors.
47. The end-September 2022 provisional figures indicate that total gross public debt stood at GH¢467,371.31 million (US$48,871.34 million), representing approximately 75.9 percent of GDP.
48. The domestic debt component is GH¢195,657.60 million, which is 31.79 percent of GDP, whilst external debt is GH¢271,713.71 million, representing 44.15 percent of GDP.
The increase in the domestic debt is largely on account of rising interest costs. Domestic debt as a share of total public debt reduced from 51.6 percent in 2021 to 41.9 percent as at end September 2022.
49. Mr. Speaker, the external debt as a percentage of the total debt stock is 58.1 percent as at end September 2022.
The sharp growth in the external debt stock is largely driven by the depreciation of the local currency. The depreciation of the Ghana cedi added GH¢93,855.15 million to the external debt stock.
50. Overall, debt accumulation increased from 20.7 percent in 2021 to 32.7 percent as at end September 2022, reflecting the impact of the depreciation of the Ghana cedi on the external debt side.
Outlook for External Sector in 2023 and the Medium Term
51. Mr. Speaker, the external sector performance in the outlook will depend largely on the quick resolution of the Russia-Ukraine war and the outcome of recession fears in advanced economies.
The thrust of the external sector will focus on rebuilding external buffers enough to cover at least three and half months of imports of goods and services to cushion the economy against adverse external shocks.
This will be underpinned by, among others, bilateral support, and strong remittance inflows. Measures by BOG to address the Exchange Rate depreciation
52. Mr. Speaker, the Bank of Ghana will continue to monitor inflation developments and respond appropriately to contain price pressures. Monetary Policy will focus on using the monetary policy rate to, among others, contain inflationary pressures.
53. Since August 2022, the Bank of Ghana has successfully been working with the mining firms, international oil companies, and their bankers to purchase all foreign exchange arising from the voluntary repatriation.
UPDATE ON THE GHANA’S ENGAGEMENT WITH THE IMF FOR A FUNDSUPPORTED PROGRAMME
54. Mr. Speaker, since Government announced its engagement with the International Monetary Fund (IMF or the Fund) for a supported Programme on 1st July, 2022, we have made substantial progress.
The Fund assured Government of its strong commitment and support in these difficult times.
55. Mr. Speaker, Government and the IMF have agreed on programme objectives, a preliminary fiscal adjustment path, debt strategy and financing required for the programme to be in line with the Government’s Post-COVID-19 Programme for Economic Growth (PC-PEG).
The PC-PEG is Government’s blueprint to restore macroeconomic stability, promote debt sustainability, sustain economic recovery and support structural reforms.
2023 and Medium-Term Overall Macroeconomic Targets
56. Mr. Speaker, guided by the medium-term policy objectives, the following macroeconomic targets are set for the medium-term (2023-2026):
i. Overall Real GDP to grow at an average rate of 4.3 percent;
ii. Non-Oil Real GDP to grow at an average rate of 4.0 percent;
iii. Inflation to be within the target band of 8±2 percent;
iv. Primary Balance on Commitment basis to average 0.8 % of GDP in the 2023- 2026 period; and
v. Gross International Reserves to cover at least 4 months of imports.
57. Mr. Speaker, based on the overall macroeconomic objectives and the mediumterm targets, the following macroeconomic targets are set for the 2023 fiscal year:
i. Overall Real GDP growth of 2.8 percent;
ii. Non-Oil Real GDP growth of 3.0 percent; iii. End-December inflation rate of 18.9 percent
iv. Primary Balance on Commitment basis of 0.7% of GDP; and
v. Gross International Reserves to cover not less than 3.3 months of imports.
Resource Mobilisation and Allocation For 2023
Resource Mobilisation for 2023
58. Mr. Speaker, Total Revenue and Grants is projected at GH¢143,956 million (18.0% of GDP) and is underpinned by permanent revenue measures – largely Tax revenue measures – amounting to 1.35 percent of GDP as outlined in the revenue measures.
Resource Allocation for 2023
59. Mr. Speaker, Total Expenditure (including clearance of Arrears) is projected at GH¢205,431 million (25.6% of GDP).
This estimate shows a contraction of 0.3 percentage points of GDP in primary expenditures (commitment basis) compared to the projected outturn in 2022 and a demonstration of Government’s resolve to consolidate its public finances.
60. Mr. Speaker, the following projections underpin the resource allocation for 2023:
Compensation of Employees is projected at GH¢44,990 million (5.6% of GDP).
Mr. Speaker, Use of Goods and Services is also projected at GH¢8,048 million (1.0% of GDP).
Mr. Speaker, Interest Payment is projected at GH¢52,550 million (6.6% of GDP).
Mr. Speaker, Grants to Other Government Units is estimated at GH¢30,079 million (3.8% of GDP).
Mr. Speaker, Capital Expenditure (CAPEX) is projected at GH¢27,694 million (3.5% of GDP).
Mr. Speaker, Other Expenditure, mainly comprising Energy Sector Levies (ESL) transfers and Energy Sector Payment Shortfalls is estimated at GH¢26,739 million.
Budget Balances and Financing Operations for 2023
61. Mr. Speaker, based on the estimates for Total Revenue & Grants and Total Expenditure (including arrears clearance), the overall Budget balance to be financed is a fiscal deficit of GH¢61,475 million, equivalent to 7.7 percent of GDP.
The corresponding Primary balance is a deficit of GH¢8,925 million, equivalent to 1.1 percent of GDP.
62. Mr. Speaker, I wish to notify you that, Budget items such as Interest Payments, Amortisation and Financing will be adjusted accordingly once Government’s debt management strategy and financing to be provided by international partners in the context of the Fund-supported programme have been finalised.
Revenue Measures
63. Mr. Speaker, Government has consistently indicated its intention to improve the revenue collection effort by leveraging technology to enhance tax administration, identify and register taxable persons and improve tax compliance. 64.
Mr. Speaker, Government has received several proposals for review of the Electronic Transfer Levy and is working closely with all stakeholders to evaluate the impact of the Levy in order to decide on the next line of action which will include revision of the various exclusions.
As a first step, however, the headline rate will be reduced to one percent (1%) of the transaction value alongside the removal of the daily threshold.
65. To this end, the income tax regime will undergo reforms to among others, review the upper limits for vehicle benefits and introduce an additional income tax bracket of 35%.
2023 BUDGET STATEMENT 20
Expenditure Measures
66. Mr. Speaker, key expenditure measures will also be pursued to support the fiscal consolidation process.
In this regard, it is proposed that Government:
i. Reduce the threshold on earmarked funds from the current 25 percent of Tax Revenue to 17.5 percent of Tax Revenues;
ii. Migrate all earmarked funds onto the GIFMIS platforms and ensure they use the GIFMIS platform to process all their revenue and expenditures transactions.
v. Continue with 30% cut in the salaries of the President, Vice President, Ministers, Deputy Ministers, MMDCEs, and political office holders including those in State-Owned Enterprises;
vii. Place a cap on salary adjustment of SOEs to be lower-than-negotiated base pay increase on Single Spine Salary Structure for each year;
Fiscal Contingency Planning
67. Mr. Speaker, given the uncertainties about the macroeconomic environment, Government stands ready to deploy additional tools if fiscal outturns require further interventions. On the revenue side, some of the measures that will be identified for the Medium Term Revenue Strategy being designed by Government in the context of the IMF programme could be implemented early on.
On the spending side, MDAs budget allocation for Goods and Services or Domestic CAPEX would be strictly controlled by the quarterly budget allotment system. Key Government Interventions 68.
Mr. Speaker, the present economic challenges have heightened the need to transform our economy through a renewed focus on boosting local capacity for increased export promotion, to expand job creation while protecting the vulnerable.
69. Government is therefore taking active steps to address the impact of these economic shocks on Ghanaians through the seven-point agenda to restore macroeconomic stability and accelerate our economic transformation as articulated in the Post-COVID-19 Programme for Economic Growth.
DEVELOPING LOCAL CAPACITY FOR PRODUCTION
70. Mr. Speaker, as I have already indicated, Ghana’s heavy dependence on imports places tremendous pressure on the Cedi, creating an unfavourable balance of payments position.
On average, Ghana’s import bill exceeds US$10 billion annually and is accounted for by a diverse range of items that include iron, steel, aluminum, sugar, rice, fish, poultry, palm oil, cement, fertilizers, pharmaceuticals, Toilet roll, toothpick, fruit juices, etc.
71. We currently have the capacity as a country to locally produce items that account for about 45 percent of the value of our annual imports. These include rice, fish, sugar, poultry, cement, pharmaceuticals, jute bags, computers, etc.
To this end, Government will target these products for import substitution by supporting the private sector, through partnerships with existing and prospective businesses to expand, rehabilitate and establish manufacturing plants targeted at producing these selected items.
GhanaCARES “Obaatan pa” Programme
72. Mr. Speaker, it has been two years since the launch of the GhanaCARES programme to mitigate the severe impact of the COVID-19 pandemic on the economy.
Significant achievement has been made with the implementation of agreed activities despite the current macroeconomic challenges.
73. Mr. Speaker, the high food prices and pressures on the local currency validates the current focusof the GhanaCARES Programme to bolster the productive and export capacity of the private sector.
To this end, an Economic Enclave project with focus on providing support for the cultivation of up to 110,000 acres of land in the Greater Accra, Ashanti, Central, Savannah and Oti Regions is being pursued.
74. Mr. Speaker, this initiative which seeks to expand our production and productivity in rice, tomato, maize, vegetables and poultry is being led and coordinated by the Millennium Development Authority (MiDA) in collaboration with other Government institutions such as the Ministry of Food and Agriculture (MoFA), Ministry of Energy, Ghana Irrigation Development Authority (GIDA), 48 Engineers Regiment of the Ghana Armed Forces (GAF) under the Ministry of Defence, the National Entrepreneurial and Innovation Programme (NEIP) and the National Service Secretariat (NSS).
75. Mr. Speaker, consistent with the private sector-led approach, the programme will engage interested private sector actors to expand and agricultural production and processing in the Asutuare-Tsopoli Economic Enclave area based on a Partnership Framework.
The same approach will be adopted for the lands secured in the Ashanti, Central, Savannah and Oti regions.
76. Mr. Speaker, we have also initiated discussions with the Graphic Communication Group Limited to explore the feasibility of producing paper locally using the by-products of the cultivated rice in the Economic Enclave at Asutuare as raw material.
It is envisaged that the imports of paper will be replaced, and more jobs created.
77. Mr. Speaker, in addition to the Enclave Project, GhanaCARES programme in 2023 will continue to offer catalytic support in the following targeted areas.
To this end, the programme will:
● work with DBG to provide funding to interested and targeted farmers
● support MoFA to adopt and deploy the farmer registration database for the farmer input subsidy programme to enhance efficiency;
● support the Ministry of Communication and Digitalisation (MoCD) to establish a tech hub to improve knowledge in Technology and innovation by the youth, in collaboration with the University of Ghana;
● ensure the operationalisation of the Foundry under a sustainable private sector management framework;
● provide interest rate subsidies and direct financing; including supporting prioritised sectors in the rural economy through the ARB Apex Bank and its network of banks as agreed under the AfDB-supported Post-COVID Skills and Productivity Enhancement Project.
YouStart
78. Mr. Speaker, in fulfillment of our pledge of building an entrepreneurial state, the implementation of the YouStart programme began this year.
The programme was successfully piloted with 70 beneficiaries and an amount of GH¢1.98 million was disbursed to support youth-led (below the age of 40 years) SMEs in poultry, agro processing, ICT, textiles, and food processing sectors.
79. Government has successfully signed an MoU with the Ghana Association of Banks (GAB) and eleven (11) other commercial Banks for the implementation of the commercial component of the programme.
80. Mr. Speaker, a launch for the District Entrepreneurship Programme (DEP) component of the programme was held on 14th November, 2022 and it is expected that the launch of the Commercial component of the Programme will occur by the end of 2022 to enable qualified beneficiaries access support.
One District One Factory (1D1F)
81. Mr. Speaker, the One-District-One-Factory (1D1F) Initiative continued to make remarkable progress in 2022.
To date, a total of 296 1D1F projects are at various stages of implementation, out of which 126 are currently operational, 143 are under construction, and 27 are pipeline projects.
82. In 2023, Government will intensify support to existing and new manufacturing enterprises with technical assistance, credit facilitation, and access to electricity and other infrastructure. Automotive Assembly Programme
83. Mr. Speaker, in addition to the Automotive Assembly Programme, Government has developed a new Components Manufacturing Policy which seeks to support the local production and supply of components and spare parts for the automotive industry.
The Ministry of Trade and Industry will launch and commence implementation of the policy in 2023 which is expected to expand job creation.
Promotion of Organic Fertilizer
84. Mr. Speaker, the recent global crisis has severely disrupted inorganic fertilizer supply chains.
This has resulted in sharp increases in prices making it difficult for farmers to access the commodity and thus threatening food security.
85. The Ministry of Food and Agriculture is intensifying efforts to promote the local production and use of organic fertilizers.
Further to this, under the subsidy programme, the Ministry has increased the quota for organic fertilizer suppliers to cover the shortfall in supply of inorganic fertilisers.
86. Additionally, Government is facilitating the establishment and the expansion of local organic fertilizer production plants with support from the EXIM Bank.
African Continental Free Trade Agreement (AfCFTA)
87. Mr. Speaker, we will pursue strategically, opportunities that ensure that we take full advantage of the African Continental Free Trade Agreement (AfCFTA) as part of efforts to pursue an export-led economic recovery.
The Ministry of Trade and Industry is working with over 200 Ghanaian companies to facilitate their entry into the African market including about 70 1D1F companies.
Additionally, the AfCFTA Guided Trade Initiative (GTI) has been launched to start commercially meaningful trade.
The products identified for the Initiative include batteries, tea, coffee, ceramic tiles, processed meat products, corn starch, sugar, and pasta, amongst others, in line with the AfCFTA focus on value chain development.
88. Mr. Speaker, the Ghana Export Promotion Authority will enhance its coordination role by facilitating support to key export-sector stakeholders. Export Trade Houses (ETHs) will be established in selected markets to promote made-in-Ghana products brands, including the completion of the first ETH in Kenya.
Additionally, opportunities will be created for local Ghanaian businessmen and investors to invest in export product transformation and value addition at the district level in partnership with the Ministry of Local Government and Rural Development. Development Bank Ghana
89. Mr. Speaker, Government through the Development Bank Ghana (DBG) has established a GH¢500 million special credit programme: the DBG Emergency Economic Programme (DEEP) to support businesses in the agribusiness value chain over the next five years.
The priority sectors are Poultry, Rice & Cereals, Pharmaceutical manufacturing, Tourism, Textiles & Garments for investments to help build economic resilience.
90. Mr. Speaker, to support SMEs with equity funding, DBG is also in the process of establishing a private equity fund with an initial capitalization of about GH¢400m (US$30m).
DBG has fully on-boarded four Participating Financial Institutions (PFIs) and will engage other financial institutions to expand its loan channels.
A total of seven loans amounting to GH¢ 245,322,000.00 was disbursed to SME’s saving over 1,000 jobs.
DBG has partnered with a PFI to build a digital lending platform to shorten the processing time for lending to SMEs and increase its ability to reach a lot more businesses across the country.
Ghana Agricultural Insurance Pool (GAIP)
91. Mr. Speaker, the National Insurance Commission, is spearheading the development of agricultural insurance for farmers through the Ghana Agricultural Insurance Pool (GAIP).
GAIP provides traditional agricultural insurance and indexbased weather insurance products to commercial farmers and small-holder farmers.
An estimated USD$400 million in agricultural insurance will be extended to eligible farmers in 2023.
EXPANDING INFRASTRUCTURE DEVELOPMENT
92. Mr. Speaker, as part of effort to ensure power is affordable for industrial, commercial and residential use, Government has substantially completed a renegotiation and restructuring exercise of Power Purchase Agreements (“PPAs”) with 6 operational Independent Power Producers (“IPPs”), namely, Karpower, Cenpower, Early Power, Twin City Energy (formerly Amandi), AKSA Energy and CENIT Energy.
93. Government has also pursued cost-cutting and green initiatives, including conversion to a tolling model, refinancing of expensive debt, profiling of tariffs and switching power plants from imported liquid fuel to locally produced natural gas as primary fuel.
94. On connectivity to the national grid, a total of 157 communities were linked to the national grid as of September 2022.
The Ministry of Energy will further connect an additional 400 towns under the SHEP-4, SHEP-5 and Turnkey Projects in 2023.
The Coastal Fishing Ports And Landing Sites Redevelopment Project
95. Mr. Speaker, substantial progress has been made in the development of 12 coastal fish landing sites and 2 fishing ports along the coast of Ghana namely, Axim and Dixcove in the Western Region, Moree, Mfantsiman, Ekumfi, Mumford, Winneba, Senya Beraku, Gomoa Feteh and Elmina, in the Central Region, Teshie, Osu and James Town in the Greater Accra Regions and Keta in the Volta Region.
96. Mr. Speaker, overall, the project is about 95 percent complete and will ensure safe launching and landing of artisanal fishing canoes and promote hygienic environmental conditions. Climate Change
97. Mr. Speaker, global warming poses major threats to the economies of climate vulnerable countries like Ghana.
According to the Vulnerable Twenty (V20) Loss and Damage Report, Ghana lost US$15.20billion from 2000 to 2019 to climate change.
According to the World Bank Group’s new Country Climate and Development Report (CCDR) for Ghana, incomes could reduce by up to 40% for poor households by 2050, if urgent climate actions are not taken.
98. At COP27, the Government took the opportunity to leverage its bilateral engagements to expand consultations on debt-for-nature swaps as well as increased private sector investments to accelerate our transition to low carbon growth and finance our climate action measures.
99. Mr. Speaker, I can report that Ghana has assumed the Presidency (from 2022 to 2024) of the Climate Vulnerable Forum (CVF) and Chair of the Vulnerable Twenty (V20) Group of Ministers of Finance.
Government will leverage this opportunity to accelerate our climate agenda which is outlined in Ghana’s Climate Prosperity Plans.
SOCIAL PROTECTION
100. Mr. Speaker, even amidst the current difficulties, we remain committed to implementing Ghana’s social protection programmes.
We will not renege on our responsibilities towards the vulnerable and socially excluded and the implementation of our various social protection programmes will be expanded.
Livelihood Empowerment Against Poverty (LEAP)
101. Mr. Speaker, the Livelihood Empowerment Against Poverty (LEAP) Programme has since its inception in 2008, supported extremely poor and vulnerable households; increasing beneficiary coverage from 143,552 in 2015 to 344,389 households comprising 1,827,035 individuals as of September 2022.
102. Government is committed to expanding coverage to all 2,500,000 extreme poor individuals as estimated by the Ghana Living Standards Survey (GLSS 7) by 2024.
While improving efficiency through digitalisation and assessment, Government will, in 2023, increase the value of the LEAP grant from the average of GHC 41.75 per household to GH¢95.19 bi-monthly.
Ghana School Feeding Programme (GSFP)
103. Mr. Speaker, the Ghana School Feeding Programme (GSFP) which provides one hot nutritious meal each day for 3,448,065 beneficiary pupils in public basic schools as of December, 2021 will be sustained.
104. In 2023, the feeding grant will be increased to reflect the current cost of living.
The programme will also strengthen domestic production by sourcing locally produced food from the National Buffer Stock company.
Capitation Grant
105. Mr. Speaker, the Government abolished the charging and payments of all forms of fees/levies in all public basic schools and replaced them with the capitation grant in 2005.
This has contributed to steady increases in enrollment over the years.
106. Mr. Speaker, Government will continue to strengthen monitoring to address teething challenges in the implementation of the policy which include; timely release of the grant, misuse of funds, transparency and poor book keeping and value of grant amount.
EXPANDING INFRASTRUCTURE
107. Mr. Speaker, in fulfillment of Government’s commitment to improve road infrastructure, the Ministry of Roads and Highways continued its Nationwide Road and Bridge Construction Programme.
108. Works on the La Beach Road Project and the construction of a 3-tier interchange at Nungua Barrier are progressing steadily.
Works on the interchange currently stand at 62 percent.
Construction of the Kumasi Lake Roads and Drainage Extension project is almost complete and stands at 97 per cent.
109. Work is ongoing on the 17.85 km Ofankor Nsawam dual carriage road which is scheduled to be completed in May 2024 110.
Mr. Speaker, dualisation on the Tema – Aflao and the Tema – Akosombo roads has commenced. Works are ongoing on the rehabilitation of Assin Fosu – Assin Praso road including the dualisation of 1.2km of Assin Fosu township roads into a 4-lane carriageway is at 53 percent.
Additionally, works on the reconstruction of Bechem – Techimantia – Akomadan and Agona Nkwanta – Tarkwa roads are at 21 percent and 7 percent completion, respectively.
111. Works on Phase II of the Obetsebi Lamptey Circle Interchange and ancillary work is at 71 percent completion.
Additionally, construction of the Flyover over the Accra-Tema Motorway from the Flower Pot roundabout is 56 percent complete.
112. Mr. Speaker, to improve connectivity within areas cut off by waterways, work on the construction of 50No. prefabricated bridges continued in 2022.
Progress of the new bridge being constructed over River Pra to separate vehicular traffic from the rail along the Twifo Praso-Dunkwa road is at 87 percent completion. 113. Mr. Speaker, the Critical Regional and Inter-Regional Road Projects initiated in 2019 are at various stages of completion. Completed projects include:
● Upgrading of Golokwati-Wli Road;
● Upgrading of Nsuta – Beposo, Lot 3;
● Rehabilitation of Nkonya Wrumpong – Kwamikrom;
● Partial Reconstruction of Bawjiase – Adeiso; and
● Resealing of Tamale – Salaga Road – Lot.
114. Progress on the following roads, among other have achieved significant progress:
● Upgrading of Navrongo – Naga Road
● Upgrading of Wa-Bulenga-Yaala Road
● Upgrading of Salaga – Ekumdipe – Kpandai Road
● Kpandai – Nkanchina Road (10.8km)
● Rehabilitation of Atebubu – Kwame Danso Roads
● Upgrading of Anwiankwanta – Obuasi Road
● Rehabilitation Of New Abirem – Ofoasekuma Road
● Upgrading of Sefwi Wiawso – Akontombra Road
● Upgrading of Akrodie – Sayereso Road
● Rehabilitation of selected roads in Greater Accra.
115. Mr. Speaker, contract works under the Master Project Support Agreement (MPSA) with Sinohydro Corporation Limited are stages of completion:
● Tamale Interchange Project (100%)
● Western Region and Cape Coast Inner City Roads (100%)
● Upgrading of Selected Feeder Roads in Ashanti and Western Regions (100%)
● Construction of Hohoe-Jasikan–Dodi-Pepesu (100%)
116. Mr. Speaker, in 2023, a number of pipeline projects which are at various stages of preparation will be pursued.
These include:
● Construction of Accra – Kumasi Road: Anyinam Bypass;
● Construction of Accra – Kumasi Road: Konongo Bypass;
● Construction of Adidome – Asikuma Junction and Asutsuare – Aveyime including 2No. interchanges at Dufor Adidome and Asikuma Junction;
● Kasoa – Cape Coast Dualisation;
● Dualization of Sekondi and Adiembra Roads;
● Takoradi -Agona-Nkwanta- Apemanim
● Construction of Bridge over the Volta River at Volivo;
● Buipe, Yapei and Daboya Bridges;
● Adawso-Ekyi Amanfrom Bridge; and
● Dikpe, Iture and Ankobra Bridges. Road Financing 117. Mr. Speaker, Government is pursuing the strategic decision to procure the 27.7km of the Accra-Tema Motorway and Extensions Project through the Ghana Infrastructure Investment Fund (GIIF).
A PPP Concession Agreement backed by an appropriate toll arrangement will be presented to Parliament for approval to facilitate its execution.
Provision has also been made in the 2023 and the Medium-Term Budget for the Equity and Viability Gap Funding required by a GIIF Special Purpose Vehicle (SPV) to enable the project to start in earnest in 2023.
The project will be delivered in phases.
118. Mr. Speaker, the iconic nature of the project is such that when completed, there will be five lanes each on both sides of the main Accra-Tema Motorway stretch, 33 and six lanes each on the Tetteh Quarshie-Apenkwa stretch of the road.
The project will include the remodeling of Tetteh Quarshie Interchange, the reconstruction of the Apenkwa Interchange and the construction of new interchanges at the Fiesta Royale cross roads and Neoplan area.
Debt Exchange Programme
119. Mr. Speaker, the Debt Sustainability Analysis (DSA) based on the macroeconomic outlook has been conducted by the Ministry of Finance. It analyzes the country’s capacity to finance its policy objectives and service its debts.
It covers public, publicly guaranteed debt of central government and partial non-guaranteed debt of SOEs.
120. The sustainability of our debt has been continuously affected by the negative impact of exchange rate depreciation, particularly on external debt, as well as the crystallization of significant contingent liabilities in recent years.
The current debt sustainability analysis conducted reveals that Ghana is now considered to be in high risk of debt distress.
121. Mr. Speaker, despite the heightened debt levels, Government remains committed to ensuring that debt is brought to sustainable levels over the medium to long-term.
To this end, we will implement a debt exchange programme to address the challenges identified in the portfolio in collaboration with all relevant stakeholders including the Ghanaian public, investor community and development partners.
122. Furthermore, Government will continue to strengthen its oversight of all SoEs, in particular, financial and energy sectors.
The reforms and discipline at the SoEs will reduce potential fiscal risks from incidence of contingent liabilities.
123. Preferred financing option for projects.
We, however, recognize that there may be cases where non-concessional borrowing may be required to finance critical transformative projects.
Such financing will be determined within limits that are consistent with our debt sustainability programme.
124. We will inform this House, at the Mid-Year Fiscal Policy Review, of projects that will be financed within our non-concessional borrowing limits.
Accordingly, we will not publish any list of projects to be financed from external non-concessional loans in this budget, previously titled ‘Appendix 10C’. Implementation of the Cabinet directives on expenditure measures
125. Mr. Speaker, as a first step toward expenditure rationalisation, Government has approved the following directives which takes effect from January, 2023:
● All MDAs, MMDAs and SOEs are directed to reduce fuel allocations to Political Appointees and heads of MDAs, MMDAs and SOEs by 50%.
This directive applies to all methods of fuel allocation including coupons, electronic cards, chit system, and fuel depots. Accordingly, 50% of the previous years (2022) budget allocation for fuel shall be earmarked for official business pertaining to MDAs, MMDAs and SOEs;
● A ban on the use of V8s/V6s or its equivalent except for cross country travel.
All government vehicles would be registered with GV green number plates from January 2023;
● Limited budgetary allocation for the purchase of vehicles. For the avoidance of doubt, purchase of new vehicles shall be restricted to locally assembled vehicles;
● Only essential official foreign travel across government including SOEs shall be allowed.
No official foreign travel shall be allowed for board members.
Accordingly, all government institutions should submit a travel plan for the year 2023 by mid-December of all expected travels to the Chief of Staff; 2023 BUDGET STATEMENT 35
● As far as possible, meetings and workshops should be done within the official environment or government facilities;
● Government sponsored external training and Staff Development activities at the Office of the President, Ministries and SOEs must be put on hold for the 2023 financial year;
● Reduction of expenditure on appointments including salary freezes together with suspension of certain allowances like housing, utilities and clothing, etc.;
● A freeze on new tax waivers for foreign companies and review of tax exemptions for free zone, mining, oil and gas companies;
● A hiring freeze for civil and public servants
● No new government agencies shall be established in 2023;
● There shall be no hampers for 2022;
● There shall be no printing of diaries, notepads, calendars and other promotional merchandise by MDAs, MMDAs and SOEs for 2024;
● All non-critical project must be suspended for 2023 Financial year
CONCLUSION
126. Mr. Speaker, Government cares deeply about our people, and is very much concerned about their current plight and the future of our country.
The 2023 Budget has been prepared with high consideration for the aspirations of Ghanaians and the brighter prospects of our economy to transition into Upper Middle Income within a decade.
It reflects our determination and resolve to confront the current daunting economic challenges facing our nation head-on and reset the economy.
127. In the immediate term, we will work towards securing an agreement with the International Monetary Fund, execute the debt exchange programme, improve the management of foreign exchange, and support our local productive capacity for food security. We are confident that the measures outlined in this 2023 Budget will redirect us on the path of macroeconomic stability and growth.
128. Mr. Speaker, the mission ahead is for the determined and not the pessimist. We acknowledge that our people have been severely impacted by the current economic challenges. As a responsive Government, we have acted swiftly and boldly by developing the PC-PEG and will work with local and international partners to implement it.
129. Mr. Speaker, the 2023 Budget, will focus on Government’s resolve to structurally transform the economy. We plan to:
● Aggressively mobilise domestic revenue;
● Boost local productive capacity;
● Promote a diversified and vibrant value-added export sector;
● Streamline expenditures;
● Protect the poor and vulnerable;
● Expand digital and physical infrastructure; and
● Implement structural and public sector reforms. 130. We will continue the implementation of key interventions like the YouStart, Economic Enclaves, 1D1F, and Tech Hubs with the limited resources that we have complemented with the support from Development Bank Ghana.
131. Specifically, on the YouStart, we intend to support 30,000 youth and under the Economic Enclaves, we intend to develop 110,000 acres of land for rice maize, soya bean as well as poultry. Funding will be sought from the GHc500 million DBG fund and GoG sources. We will also be aligning support from our development partners to boost growth in the real-sector, focusing mainly on agriculture, entrepreneurship and value addition.
132. Mr. Speaker, as I have indicated it has become even more urgent to mobilise domestic revenue especially in times like this when our access to the international capital market is largely closed. We urgently need to restore debt sustainability, macroeconomic stability and grow the economy. As a responsible Government, we will take the hard, unpopular, but necessary decisions to build back better and emerge stronger.
133. Mr. Speaker, post-COVID, we identified the need to ramp-up our domestic revenue mobilisation efforts to match the performance of our peers and finance our development agenda. Last year, we started with the E-Levy which has not yielded the resources as expected.
134. Mr. Speaker, we know that we have to:
● Keep the lights on at the cost of US$1billion annually;
● keep the hospitals running and ensure that the over 15.5m Ghanaians on NHIS are properly catered for;
● Keep our schools running and pay the over 300,000 teachers every month;
● Keep our hospitals running and pay the over 119,000 nurses every month;
● Keep the law courts open and ensure timely access to justice; and
● Keep the local assemblies working to deliver essential social services to our people.
135. Mr. Speaker, it has also become clear that we cannot take the territorial integrity and internal cohesion of our country for granted. In the last couple of years, we have invested significantly in retooling the security sector to maintain territorial integrity and improve internal security (we have procured CCTV cameras, motor bicycles, vehicles,
Forward Operating Bases, and recruitment of security personnel among other interventions). We can all attest that police visibility has increased tremendously.
136. Mr. Speaker, our ability to continue to deliver all these critical public services will require significant resources and we believe that together we can raise the necessary revenues to implement them.
137. Mr. Speaker, the demand for roads has become the cry of many communities in the country. Unfortunately, with the current economic difficulties and the absence of dedicated source of funding for road construction, it is difficult to meet these demands.
In that regard we are proposing the implementation of new revenue measures. The major one is an increase in the VAT rate by 2.5 percentage points.
138. This increase is expected to yield GHc2.70 billion which will be used to augment funding for our road infrastructure development. This will be complemented by a major compliance programme to ensure that we derive the maximum yields from existing revenue handles.
139. Mr. Speaker, in this Budget, we have highlighted the need for robust public sector reforms to complement the existing public financial management regime.
Here, the focus is to introduce private sector participation in the retail sub-sector of the Energy Sector to reduce system losses and improve delivery of service for Ghanaians.
140. Mr. Speaker, this afternoon, the senior National Team, the Black Stars, will be representing our nation for the fourth time at the Football World Cup in Qatar.
Let us continue to bear them in prayers and offer our support. Working together after missing the last tournament, we have risen again and taken our place on the world stage.
141. Mr. Speaker, we must be inspired by the re-emergence of the Black Stars on the world stage. We must work together to ensure that our economy rises again to the comfort of our people.
This Budget offers us a better opportunity to jointly work towards rebuilding the economy and rediscovering our providential way towards our manifest destiny.
142. Together let us arise!
143. Mr. Speaker, let us not squander the opportunity to turnaround, and reset our economy and create a bright medium-term for our country and its people. This is the time to rebuild, not to destroy and tear down. Let us work together for our collective benefit as is said in Nehemiah 2:18, with unity of purpose, service to the Republic, and the abiding grace of God.
144. Mr. Speaker, I repeat, Mr. Speaker, N) fiaa n) baa hi!! 145. Mr. Speaker, let us go forward, believing in the assurance of the Psalmist that “For the sake of the house of the LORD our God, I will seek your prosperity”. 146. Mr. Speaker, I present to you the ‘NKABOM’ Budget.
The Minority in Parliament has said it will resist any policy in the 2023 budget it feels are “draconian”.
In a statement, it reiterated the need for “drastic cuts in non-essential Government expenditures and more prudent use of scarce national resources.”
“We have also demanded greater transparency and accountability in public financial management,” the statement added.
The Minority said it expects its proposals to “find expression in the budget and signal a change in course by the failed Akufo-Addo/Bawumia Government.”
“We wish to assure the Ghanaian people that we stand with them in these difficult times, and we will not relent in our efforts to hold the managers of the economy to account,” the statement added.
The Minority also allayed fears that it could boycott the budget because of protests against the Finance Minister, Ken Ofori-Atta.
Both sides of the Parliament have called for the Finance Minister to be removed amid Ghana’s economic crisis.
The budget comes as the government tries to secure a deal from the International Monetary Fund (IMF) for economic support.
The Finance Ministry has said the 2023 Budget will focus on Government’s strategies to restore and stabilize the macroeconomy, build resilience, and promote inclusive growth and value creation.
The ministry also said it will feature updates on Ghana’s engagement with the IMF for an IMF-supported Programme; year-to-date macro-fiscal performance of the economy; the YouStart initiative under the Ghana CARES Programme; climate action strategies; fiscal measures and debt management strategies to ensure fiscal and debt sustainability and promote growth.
The Minority in Parliament has cast doubts on the ability to complete the 33.4 kilometer Ofankor-Nsawam rehabilitation project within the 24-month target.
The 341 million cedis road project consisting of 3 interchanges is progressing steadily by contractors messrs Maripoma enterprise.
On an inspection of the project on Wednesday November 23, ranking member on the roads and transport committee Kwame Governs Agbodza said the 24-month period is mere political talk.
Meanwhile , the chairman of the committee has praised government for the giving the contract to a local contractor.
“For the deadline, it is aimed at achieving a political objective before 2024.
“We should not push for an early completion to meet a certain deadline.
“They must do a proper job and I believe that it is going to be difficult to complete the the project one hundred percent within the 24 months.”
Labour consultant Austin Gamey has asked the government to be more open and transparent with the labour unions, who are currently asking for a 60% increment in their salaries.
According to him, this will enable the unions to have a perfect understanding and appreciation of the dynamics of the current economic challenges; and thus agree to a realistic increment.
“Let the employer be extremely very open and let them know of the truth, this is what we have, if we pay this, this will be the consequence and if we pay that, this will be the consequence. So let them (government) make a humble appeal to them (labour) and give them (labour) the assurance that come from next year going the right things will have to be done” Mr. Gamey explained.
Labour unions in Ghana are currently in negotiations with the government for a 60% increase in their salaries citing harsh economic conditions but the government has since proposed a 12% increase.
But speaking to Alfred Ocansey, host of the Ghana Tonight show on TV3, Austin Gamey stressed that “what they are demanding may be too much but it thus appear we’re not transparent and open enough for them (labour) to appreciate where we are, let them (government) open up and let them (labour) appreciate the dynamics of the situation in which we find ourselves and let’s agree that we’ll pay them very well and put in place systems to cheek it”.
He also urged the government to begin to develop a system that will help track the productivity of public sector workers, to enable the government to compensate them (lobour) appropriately.
He explained that “let us agree for once as a nation to develop a salary structure that is reasonable, that the national purse can accommodate and it can, except that the people will have to work for it and they do know that organized labour is not against productivity, the employer appears to be the one that is not taking the proper steps in accordance with the law”.
He indicated that a proper salary structure that will ensure workers are well paid will also set targets for the workers and that will improve productivity in the country.
Mr. Gamey also stated that the government should be able to develop a proper salary structure for the Ghanaian public sector workers before 2025 to avert further labour agitations.
Organized labour is expected to meet government today to continue negotiations on the proposal for a 60 percent increment in the base pay of the single spine salary structure for 2023.
Organized labour says the proposed 60 percent is intended to help workers deal with the rising cost of living as a result of high inflation.
The third meeting with government on Tuesday ended inconclusively, although the 2023 budget reading has been scheduled for Thursday, November 24, 2022.
Deputy General Secretary of TUC, Joshua Ansah, said their demands are reasonable.
“The law says that, finish negotiations by April so that the budget is read in November. So it is not our fault that negotiations have not been concluded and whether or not the budget will be read or not. We are all workers, and we know the inflation and economic challenges in this country. The situation is unbearable.”
The public sector workers explained that the daily base pay is lower than the government’s newly announced daily minimum wage of GH¢14.88.
Organised labour insists that its leadership will not back down on the proposed 60 percent rise in base pay.
In 2021, the Trade Union Congress (TUC) agreed on the base pay increments for public sector workers, as part of labour negotiations with the government.
However, after the agreement, some members of the labour unions expressed their disappointment at the percentage increase, saying it was too small.
Members of a coalition made up of public sector workers thus protested in 2021 to express their anger and demand an upward review of public sector salaries.
They insisted that the four and seven per cent increment were woefully inadequate for their survival, considering the current economic hardship.
The government has refuted reports that special forces from the United Kingdom are being brought to Ghana to help fight terrorism.
A report by British newspaper, the Telegraph, yesterday reported that Britain is in discussion with Ghana to send special forces into the country after it was forced to withdraw all of its peacekeepers from Mali.
“The Government of Ghana wishes to state that the information regarding British special forces is false. Neither Ghana nor any other member of the Accra Initiative has discussed with any partner, any such request nor contemplated the involvement of foreign forces in any of the activities”, a statement by the Ministry of Foreign Affairs and Regional integration stressed.
The Ministry said the Government of Ghana has had no interaction with the United Kingdom for the deployment of soldiers into the country.
“The Government of Ghana has no interactions with the UK Government aimed at deploying UK soldiers to Ghana for purposes of operations as described in the story”, parts of the statement read.
It further explained that, the Accra Initiative rather aims to prevent spillover terrorism from the Sahel and to address transnational organized crime within the common border areas of member states.
