Ghana has not been spared the painful economic and social impact that COVID-19 has visited on peoples in nations, big and small, all over the world. These were in part, the delivery made by the Finance Minister when he delivered government’s mid-year budget review.
He went on to say the ‘virus has laid bare our vulnerabilities as a world, as nations, as households and as individuals’. The pandemic has also brought to the fore the structural gaps in our health delivery system, he added.
‘We must not and will not be daunted by this extraordinary crisis’ is rather reassuring and demonstrates government’s resolve steer the course. While demonstrating a steely resolve, Mr. Ofori-Atta however was candid enough to lament that the predicted long-lasting effect of this pandemic, amidst systemic shifts and uncertainties, suggests 2020 and beyond will be very challenging.
“Therefore, this 2020 Mid-Year Fiscal Policy Review and Supplementary Estimates is the first of our economic plans to reposition Ghana and Ghanaians to deal with the challenges posed by the pandemic and seize the opportunities it brings”.
He announced that in the coming weeks the President will launch a Gh¢100 billion development programme.
The Minister requested supplementary funding to support priorities of saving lives and livelihoods, supporting businesses to ensure that the health of Ghanaians and their jobs are secure in these challenging times.
The projected real GDP growth for 2020 has been revised considerably downwards from 6.8 percent to 0.9 percent. Ofori-Atta reiterated that the fiscal cost of the COVID-19 pandemic is enormous.
He stated that the total fiscal impact of the pandemic was estimated at GHȼ9,505 million (2.5% of revised GDP), stemming from shortfalls in petroleum receipts, import duties, and other tax revenues, the cost of the Emergency Preparedness Response Plan, and the cost of the Coronavirus Alleviation Programme.
The updated fiscal estimates indicate that revenues are expected to fall short of the 2020 Budget target by GH¢13,632 million (3.5% of revised GDP) arising from shortfalls in Petroleum Receipts of GH¢5,257 million; Non-Oil Tax revenue GH¢5,089 million; and NonTax Revenues of GH¢3,286 million.
These, in our view, represent a snapshot of the pandemic’s impact on the domestic economy and what we are to expect going forward. Generally, Ghanaians were expectant of the negative economic impact of the pandemic but were not privy to the details and the Finance Minister provided it yesterday.