FINANCE MINISTER PRESENT MID-YEAR FISCAL POLICY REVIEW TODAY

The Finance Minister, Ken Ofori-Atta will present the mid-year budget review and supplementary estimates today, July 23rd, 2020, at Parliament House of Ghana in accordance with Section 28 of the Public Financial Management Act, 2016 (Act 921).

According to the Majority Leader & Minister of Parliamentary Affairs , Osei Kyei Mensah Bonsu, the Finance Minister will use the opportunity to expatiate how government intends to replenish advances it took from the Contingency Fund due to the Covid-19 pandemic which has had dire effects on the economy.

Mr. Ofori-Atta is also expected to use the opportunity to review some of the key macroeconomic targets announced in the 2020 budget read last year.

Parliament granted the request by government to withdraw an amount of ₵1.2 billion, an equivalent of $219 million from the Fund to finance the Coronavirus Alleviation Programme, (CAP).

The motive of the CAP is to mitigate the disruption to economic activities and the hardship imposed on the people of Ghana by the novel COVID-19 and to rescue and revitalize industries that have fallen prey to the pandemic.

It also received a US$1bn rapid credit facility from the IMF as part of funds for the electricity relief package for Ghanaians whilst the remainder will be used to support the 2020 budget.

Additionally, the governement borrowed GHS10bn from the Bank of Ghana (BoG) .

It also received a US$1bn rapid credit facility from the IMF as part of funds for the electricity relief package for Ghanaians whilst the remainder will be used to support the 2020 budget.

Already, the Minister has hinted the budget will also consider extending some support to businesses and industries hit by the outbreak of Coronavirus.

The presentation of the statement on the review of government projections for the 2020 financial year will be backed by a request for supplementary estimates.

Government projections for the 2020 financial year have largely been affected by the economic implications of the Coronavirus pandemic but it hopes to restrategize to generate more revenue  to revamp the economy.

Earlier this year, the Finance Minister announced that government will require some 9.5 billion cedis to fight the COVID-19 pandemic, a situation which may move the 2020 budget deficit to over 7 percent.

He also stated that this will be 2.5 percent of Ghana’s revised GDP, and there will be a “fiscal gap of GHS11.4 billion.”

Meanwhile, Parliament has decided not to allow the media to set up make-shift studios in the house to cover the budget review.

According to information from the Public Affairs Department of Parliament, the directive is in line with COVID-19 protocols put in place by the House.

Ahead of the presentation the Chamber of Independent Power Producers and Bulk Consumers, CIPDiB, has asked government to capture the payment of the about USD$1.4 billion debt owed them in the budget.

According to the Chamber, which is made up of the Sunon-Asogli Power (Ghana) Limited, BXC Solar Ghana, Cenit Energy Limited, Cenpower Generation Company Limited and Karpowership Ghana Company Limited, the continuous accumulation of the debt is forcing them to contract costly loans to sustain their generations.

The CEO of the Chamber, Elikplim Kwablah Apetorgbor, says the Independent Power Producers (IPP) may shut down their plants if payment doesn’t happen soon.

“As the Minister of Finance prepares to present to the nation how he intends to fund government activities for the remaining months of the year, we would like this budget to address specifically the debt that the government owes us. It has become very critical because we are seriously bleeding to fund our operations. As at 30th June, 2020, the cumulative indebtedness to the IPPs is about USD$1.4billion and it continues to accumulate", Mr. Kwablah stressed.

Credit: JoyNews-PM Express || Ministry of Finance Ghana.