by Jerome Kuseh
A lot has been happening in Ghana and around the world that has an impact on Ghana’s economy. Some of these I have already written about in one form or the other and this post serves as an update. Here are five notable developments for Ghana’s economy.
- Government beats deficit target for first half of the year. Higher than expected domestic revenue helped government beat the deficit target for the first half of the year. The deficit stood at GH¢2.5 billion against a target of GH¢3.3 billion. Read my full report on this here.
- Oil surprisingly ends August on a high. After hitting a 6-1/2 year low, oil prices ended up on a monthly gain of 3.7% in August. Brent crude ended at US$54.15 on August 31. The increase in price was a result of a slight decrease in production in the USA and expression of concern by OPEC over low oil prices and they being ready to talk to other oil producers.
- GRA recovers more than GH¢12 million in 2 weeks. In a move to increase domestic revenue the Ghana Revenue Authority (GRA) set up a task force that has so far collected more than GH¢12 million in revenue from defaulting companies.
- Government Postpones issue of GH¢500m 5-year bonds. The government has postponed the issue of 5-year bonds that was supposed to raise GH¢500 million. A statement from MOFEP said that government was still committed to the country’s medium to long-term debt strategy. 42% of Ghana’s domestic debt is short-term debt. The government needs to reduce this and issue more medium to long-term debt.
- IMF approves second tranche of US$116.6 million. The International Monetary Fund has approved the second tranche of US$116.6 million out of the total US$918 million that Ghana is to receive as part of the Extended Credit Facility programme Ghana has with the IMF to restore macroeconomic stability. In a press release Mr Zhu, Acting Chair of the Executive board stated:
Implementation of the ECF-supported program by the Ghanaian authorities has been broadly satisfactory, despite an unfavorable economic environment. In particular, the government’s fiscal consolidation efforts are on track and it is encouraging that the government decided to liberalize the prices of fuel products, which bodes well for expenditure control, eliminating the need for fuel subsidies and the incurrence of arrears.
The board however asked the government to continue the net freeze on public employment, clean up the payroll and to identify the full costs of next year’s election to prevent fiscal overans.