Government commits to more expenditure cuts, aggressive growth, jobs

The government of Ghana has assured its citizens that it will take further steps to reduce expenditure, promote aggressive economic growth, and create more jobs in the coming months. This commitment was reiterated by Mr Ken Ofori-Atta, the Finance Minister, and Mr Kojo Oppong Nkr umah, the Information Minister, during a press briefing on Friday evening.

The government aims to safeguard the current economic gains and ensure that they are reflected in the living conditions of all Ghanaians. To achieve this, the 202 4 budget will include more measures to reduce expenditure and consolidate macroeconomic gains. The government is determined to keep inflation and exchange rate under control to maintain a stable macroeconomy.

Speaking on the sidelines of the 2023 International Monetary Fund ( IMF)/World Bank Group (WBG) Annual Meetings in Marrakech, Mr Ofori-Atta expressed confidence in the upcoming budget, stating, “You’ll see more prudent fiscal measures in the 2024 budget to keep the macroeconomy stable so that inflation continues to go down and the currency remains stable. That’s an assurance from the government that will surely happen.” He also mentioned that the government will allocate incentives and resources to stimulate private sector growth and support its thriving.

The government has already implemented cost-cutting measures in the 2023 budget, such as a freeze on public sector employment and reduction in salaries of government officials, to support macroeconomic stability. These measures have shown positive results, but the government recognizes the need to do more.

Mr Oppong Nkrumah, the Information Minister, highlighted the positive impact of these measures, stating, “Although we don’t have the final figures, one of the clearest ways to examine the performance of the expenditure reduction measures is to look at the primary balance. We have seen a significant improvement in the primary balance, which indicates that we are staying within the revenue envelope.”

The primary balance, which represents the difference between the amount of revenue the government collects and spends on providing public goods and services, excluding debt payment, was −1.3 as of the first half of 2022, but has improved to 0.6 in the same period in 2023.

The government is committed to maintaining fiscal discipline and ensuring that the fiscals do not go out of control. Mr Oppong Nkrumah emphasized, “Going forward, our focus is to stay
on the path of fiscal discipline to ensure that we maintain stability.”

While some civil society groups, economists, and governance experts have called for further measures, such as reducing the number of ministers and government officials, the government has not yet implemented these recommendations. However, they have expressed confidence in increasing domestic revenue through measures such as collecting property taxes and incentivizing the informal sector to contribute to the tax net.

Ashantibiz