…says it lacked clear pathways
The Member of Parliament for Wa East, Dr. Godfred Seidu Jasaw says the Mid-Year Budget Statement did not engender hope and would not boost economic growth as the rank and file expect.
Finance Minister Ken Ofori-Atta presented the 2023 Mid-Year Budget Statement to Parliament on Monday and indicated that although pressures still exist, and there are formidable risks in the horizon, the economy is in a better position than it was seven months ago as the macroeconomic environment has seen relative stability since the beginning of the year.
However, Dr. Jasaw dismissed that assertion. According to him, government should move beyond “being panicky” and be more consistent, maintaining that the mid-year budget lacked clear pathways to rebound the economy.
“In the mid-year budget, we were looking for change in trajectory – some pathways so there can be some hope; but at this stage we didn’t see any of that. It is also disappointing that our growth rate projections have been revised downwards.
“I was hoping to see consistency, to see a build-on – on what the primary budget built on, which was the seven-point agenda; now if we had assessed the performance of our economy on the seven-point agenda and the finance minister telling us to what extent are we tweaking, are we still going with the seven points to finish the year, or we are reviewing some of the seven point so we can achieve.”
The government anchored its 2023 Budget Statement and Economic Policy on a seven-point agenda it believes will restore macroeconomic stability and accelerate economic transformation.
The seven-point agenda, which are also articulated in the country’s post-COVID-19 Programme for Economic Growth document (PC-PEG) are to aggressively mobilise domestic revenue, streamline and rationalise expenditures, boost local productive capacity, promote and diversify exports, protect the poor and vulnerable, expand digital and climate-responsive physical infrastructure, and implement structural and public sector reforms.
But for the MP for Wa East, the mid-year review was “a huge departure from the main 2023 budget, except the figures which he spoke to; and when you have government flip-flopping with an economy in this manner, then it raises more questions than hope. I think they are panicking; they are trying to solve a lot of problems – firefighting approach – and that is not good for Ghana. We hope to see in November, a better well-focused and well-thought through budget”.
The country has been grappling with its worst economic crisis in a generation, and is restructuring its debt as a condition for receiving International Monetary Fund support.
Mr. Ofori-Atta noted key revisions to the macro-fiscal targets for 2023 year include Overall Real GDP Growth rate of 1.5 percent down from 2.8 percent; Non-Oil Real GDP Growth rate of 1.5 percent down from 3 percent; End-period headline inflation of 31.3 percent from 18.9 percent; Primary Balance on Commitment basis of a deficit of 0.5 percent of GDP compared to a surplus of 0.7 percent of GDP, aligning with IMF-supported PC-PEG target Primary balance; Gross International Reserves (programme definition) sufficient to cover at least 0.8 months of imports of goods and services by 2023.
He said growth was expected to pick up to 2.8 percent, 4.7 percent and 4.9 percent in 2024, 2025 and 2026, respectively. The Finance Ministry now sees headline inflation of 31.3 percent at the end of the year, compared with a projection of 18.9 percent given when the 2023 budget was first presented in November 2022.