Finance Minister, Dr. Mohammed Amin Adam has stated that the Ministry of Finance is collaborating with the Bank of Ghana to implement measures to address the depreciation of the local currency.
These measures, he posited, include fast-tracking the fiscal consolidation process through rationalizing spending and enhancing revenue mobilization; intensification of the gold-for-oil programme, and the appropriate foreign exchange interventions by the Bank of Ghana.
Others include the intensification of the gold for reserve programme; the disbursements of the 3rd tranche under the 2nd Review of the International Monetary Fund-supported PC-PEG after the IMF Executive Board approval in June 2024; the disbursement from other ongoing projects including the $150 million World Bank loan and the expected disbursement of $300 million under the World Bank DPO2.
He further mentioned that the fiscal consolidation programme is gaining results as primary balance on commitment basis improved by about 4 percentage points to a deficit of 0.3% of Gross Domestic Product (GDP) at the end of 2023.
Preliminary fiscal data for quarter one 2024 showed that the primary balance (on a commitment basis) was a deficit of 0.6% of GDP, against the deficit target of 0.2% of GDP. This was largely on the back of delays in the implementation of some of the 2024 revenue measures approved for the 2024 Budget.
“We plan to fast-track revenue mobilisation in subsequent quarters to enable us to achieve our primary balance target of a surplus of 0.5% in 2024 and 1.5% of GDP in the 2025-2028 period”, Dr. Amin-Adam stated.
“We are working to restore debt sustainability by 2028. The Public Debt trajectory is already showing signs of improvement as the debt-to-GDP ratio reduced to 71.4% of GDP at the end of 2023 from 73.5% of GDP at the end of 2022,” he added.
The cedi has come under severe pressure in the past eight weeks, losing almost 20% in value to the US dollar.
It is presently going for about GH15.02 to the dollar on the retail market.