Finance Minister, Ken Ofori-Atta
Government through the Ministry of Finance and Economic Planning has commenced the process of preparing the 2022 budget and fiscal policy which is likely to be presented in November 2021.
The guidelines of the policy document will provide the needed policy direction of government, instructions, budget expenditure, processes, and procedures.
According to details of the yet-to-be-prepared and presented budget, government will set its focus on revitalizing the economy from the impact of the COVID-19 through inclusive and sustainable policies.
A statement from the ministry of finance said, “Government will therefore focus on revitalising and transforming the economy. The approach is to catalyse the private sector in targeted areas to fast-track industrialisation, competitive import substitution, digitalisation, export expansion and the creation of decent jobs -particularly for the youth,”
The medium-term fiscal policy guideline of government which will span from 2022-2025 will place primary focus on fiscal consolidation strategies leading to fiscal and debt sustainability.
This would however support macroeconomic stability of the country as well as spearheading the implementation of government’s revitalization agenda; Ghana CARES programme and its other flagship initiatives.
“This strategy will progressively reduce the overall fiscal balance back to the Fiscal Responsibility Act (FRA) deficit threshold of 5 percent of GDP and a primary surplus by 2024,” the guideline highlighted.
For the 2022 financial year, government is projecting an overall budget of GH¢39.2billion which includes the financial sector clean and energy sector cost which is equivalent to 7.9% of Gross Domestic Product.
The figure is however expected to moderate downwards to GH¢30.3 billion (4.8 percent of GDP) by 2024 and finally to GH¢30.8 billion (4.3 percent of GDP) in 2025.
For the corresponding balance primary balance of government, it is estimated to be at a deficit of GH¢2.1 billion, representing 0.4 percent of GDP for 2022 – returning to a surplus of GH¢2.6 billion – 0.5 percent of GDP; GH¢8.4 billion – 1.3 percent of GDP; and GH¢10.5 billion – 1.5 percent of GDP for 2023, 2024 and 2025 respectively.