Spokesperson of the Vice President, Dr Gideon Boako has said that the government cannot run away from issues around the public debt situation.
He said this while responding to a question as to why the Finance Minister Ken Ofori Atta did not mention the debt situation in the 2022 mid year budget review he presented to Parliament on Monday July 25.
Following the presentation, the opposition lawmakers said the Finance Minister missed an opportunity to address the key issues affecting the country, especially the public debt.
The Ajumako-Enyan-Esiam Member of Parliament, Cassiel Ato Forson said the presentation was “very empty. Everything in this country is not working yet the Minister responsible for Finance appeared before us and said nothing, he failed to address the very concerns of the ordinary Ghanaians.”
“Today, he comes here once again only to tell us that he has missed all the targets he set in the 2022 budget, every one of them, he could not achieve.
“Today, our public debt is in excess of 400billion cedis and yet the Minister in this document fails to talk about the public debt,” the Former Deputy Minister of Finance told journalists after the mid-year budget presentation in Parliament on Monday, July 25.
“We can do it, we have done it before,” he added.
But reacting to this, Mr Gideon Boako said “I think the issue about debt is something that the government cannot run away from. Already, there is a debt analysis report that is presented to Parliament.
“The whole IMF engagement is going to center on more or less, debt sustainability because the IMF will not lend to unsustainability, and so before the IMF lends to you they have to make sure that you are on a sustainable path. So certainly, debt is a bigger issue that government will have to deal with.
“But I guess and understand that probably, the main budget document, there is no way debt can be skipped in the presentation, and the speech of the Minister to Parliament, it is not everything that can be spelt out in the speech.”
” So I can understand from that angle but the issue about debt and how government intends to go on the path of debt sustainability, and some of them are reflected in the macro targets that government talks about, the primary balance. Because if you are not going to have positive primary balance, it will be difficult for you to convince any body that you will be on a debt sustainability,” he told Accra-based Citi TV on Monday July 25.
The Finance Minister in the review announced that the overall Real Gross Domestic Product (GDP) for 2021 grew strongly by 5.4 per cent compared to 0.5 percent recorded in 2020 and the revised 2021 annual target of 5.1 percent.
Presenting the budget in Parliament on Monday, July 25, he said, at the time of presenting the 2022 Budget in November last year, we
provided information on macroeconomic developments for the first nine months of the 2021 fiscal year.
“We now have received updated information through to end-December 2021, he said.
“Overall Real GDP for 2021 grew strongly by 5.4 percent compared to 0.5 percent recorded in 2020 and the revised 2021 annual target of 5.1 percent.”
“Non-oil GDP growth also increased to 6.9 percent compared to a growth of 1.0 percent recorded in 2020, and the revised 2021 target of 7.0 percent. The overall budget deficit of GH¢28,095 million (5.6% of GDP), against a deficit target of GH¢19,730 million (3.9% of GDP).”
“Primary balance for the period was a deficit of GH¢7,618 million (1.5% of GDP), against a deficit target of GH¢672 million (0.1% of GDP). Public-debt-to-GDP ratio stood at 76.6% at the end of 2021.”
Regarding the Macroeconomic Performance for half-year 2022, he said provisional Q1-2022 National Accounts Statistics published by Ghana
Statistical Service (GSS) in June 2022 shows that the overall real GDP growth for the first quarter of 2022 was 3.3 percent compared to 3.6 percent recorded in the same period Non-oil GDP for the first quarter of 2022 grew by 3.7 percent compared with the Q1-2020 growth of 5.3 percent.
Regarding the revision to the 2022 Macroeconomic Framework, Mr Ofori-Atta said “as I have already indicated, the macroeconomic environment has significantly changed, prompting the revision of the macroeconomic framework.
“Furthermore, based on the developments for the first six months of 2022 and outlook for the rest of the year, we have accordingly revised the macro-fiscal targets for 2022 as follows: Overall GDP Growth rate of 3.7 percent down from 5.8 percent; Non-Oil GDP Growth rate of to 4.3 percent down from 5.9 percent, End period inflation of 28.5 percent up from 8 percent; The overall fiscal deficit of 6.6% of GDP down from 7.4%
“Primary surplus of 0.4% of GDP up from a surplus of 0.1% of GDP; and The Gross International Reserves of not less than 3 months import cover.”