Ofori-Atta presents 2021 Mid-year Budget Review today

The Finance Minister, Ken Ofori-Atta, is expected to present the government’s 2021 Mid-year statement and economic policy to parliament today (July 29).

The presentation is in accordance with Article 179 (8) of the 1992 Constitution and Section 28 of the Public Financial Management Act, 2016 (Act 921).

Per the Act, the Minister of Finance is expected to present the Mid-year Budget to parliament not later than 31st July of each financial year.

The review would touch on the economic and fiscal performance of the economy for the first half of 2021, an update on the implementation of key programmes, and the status of the implementation of the Ghana CARES programme.

Macroeconomic performance and debt management                                      

Among other things, the minister is expected to provide the house with details on recent macroeconomic development including medium-term debt management strategy amid growing concern over the country’s ballooning debt.

The country’s public debt stock has already increased to GH¢332.4 billion after seeing an addition of GH¢27.8 billion in April and May 2021.

The increase in the debt stock, which stood at GH¢ 304.6 billion at the end of the first quarter of 2021 has brought the debt to Gross Domestic Product (GDP) ratio to 76.6%, from the 76.1% recorded at the end of 2020.

In addition, the Bank of Ghana (BoG) has pegged the current account deficit for the first half of 2021 at an estimated $926.1 million (1.3% of GDP). This was $378.1 more than the $548 million (0.8% of GDP) for the same period in 2020.

For this reason, a prudent financial management is required, and the minister is expected to outline the strategy that the country would adopt in that regard.

He would also update the house on petroleum revenue and its utilisation in the first six months of the year and taxations.

Indicating what is to come, a statement by the finance ministry noted that “the review is expected to focus on revenue, expenditure, and financing performance for the first half of 2021 and provide an overview of the implementation of the 2021 budget.”

COVID-19 and related issues

Mr Ofori-Atta would also brief the house on the outcome of measures taken by the government to address the COVID-19 pandemic.

Additionally, the mid-year review would highlight the status of the implementation of the GH¢100 billion Ghana CARES “Obaatanpa” programme that sought to revitalize and transform the economy to pre-pandemic times.

Meanwhile, the International Monetary Fund (IMF) has asked the government to expedite efforts to conclude audit on its COVID-19 expenditure.

The IMF, in its July 2021 Article IV Consultation Report on Ghana, “encouraged the timely completion of the planned audit of COVID‑19 emergency spending and new expenditure arrears.”

Government’s flagship initiatives and programmes

Mr Ofori-Atta is expected to provide information on government initiatives and policies to create employment for Ghanaians, especially the youth.

Some areas of importance would be the Planting for Food and Jobs (PFJ) programme and the One District-One Factory (1D1F).

Providing figures on the number of factories established about a week ago, the Minister for Trade and Industry, Alan Kyerematen, said there were 278 projects at various stages of implementation.

Infrastructure development is expected to also feature prominently due to the promise of constructing more roads in the country under Akufo-Addo’s second term.

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