…Minister of Finance convenes strategic breakfast meeting
By Mawuli Nyamadzi
The recent emergency meeting convened by the Minister of Finance,Dr Cassel Ato Forson provided a platform for critical stakeholders to align on the government’s unwavering commitment to rebuilding Ghana’s capital market and restoring macroeconomic stability.
The Minister expressed deep appreciation to all present, acknowledging their prompt response as a testament to their shared dedication toward revitalizing the nation’s financial ecosystem.
Government’s Commitment to Economic Stability
In his address, the Minister emphasized that the government remains resolute in returning the economy to its pre-Domestic Debt Exchange Programme (DDEP) strength.
He outlined a series of bold and strategic initiatives designed to reinforce fiscal discipline, rebuild investor confidence, and ensure long-term economic sustainability.
The government is implementing an expenditure-led fiscal consolidation strategy to restore macroeconomic stability while ensuring fiscal and debt sustainability. A primary surplus target of 1.5% of GDP by the end of the fiscal year has been set under the IMF-supported Post-COVID-19 Economic Growth (PCPEG) programme to support the fiscal consolidation process.
To institutionalise fiscal responsibility, a Fiscal Responsibility Act will be submitted to Parliament to establish a debt ceiling and maintain prudent fiscal discipline.
Efforts are also underway to reduce Net Domestic Financing (NDF) relative to 2024, alleviating pressure on the domestic financial system. Adequate financial buffers are being built to ensure the government’s ability to service its debts seamlessly throughout the 2025 fiscal year.
A shift away from reliance on treasury bills aims to minimise refinancing risks and foster sustainable financing mechanisms. Strengthened collaboration between fiscal and monetary authorities is being promoted to ensure seamless policy alignment.
To finance the 2025 budget, the government is prioritizing longer-dated securities and reopening the bond market to attract substantial capital inflows, reducing reliance on shorter-dated instruments.
The Central Bank Governor’s Assurance
Addressing the gathering, the Governor of the Central Bank,Dr Johnson Asiama reassured market participants of the institution’s steadfast commitment to maintaining a robust monetary policy framework.
He emphasised the Bank’s primary goal of ensuring price stability and fostering a resilient economy, calling for sustained collaboration between fiscal and monetary agents to achieve policy coherence and economic stability.
The Governor highlighted the crucial role of an independent and credible central bank in steering Ghana’s economic recovery.
He reiterated that prudent monetary policies would be pursued to keep inflation in check, stabilize the local currency, and support sustainable economic growth.
Strengthening Debt Servicing and Market Confidence
To bolster confidence in the financial sector, the Minister of Finance referenced Sections 37 to 44 of Ghana’s Public Financial Management Act, 2016 (Act 921), which pertain to the establishment and administration of the Sinking Fund.
He reassured the banking and financial sector that the government has effectively set up the Sinking Fund to service DDEP bonds as they mature.
Furthermore, he urged financial institutions to accept DDEP bonds as credible collateral, reinforcing the government’s stance on honouring its obligations and deepening the capital market. This initiative is expected to restore investor trust and encourage active participation in Ghana’s financial markets.
Conclusion
The meeting underscored the government’s proactive approach in addressing economic challenges while signalling a new era of policy coordination between fiscal and monetary authorities.
With a clear roadmap for fiscal consolidation, debt sustainability, and capital market recovery, Ghana’s financial sector is poised for renewed investor confidence and economic stability.
The collaborative spirit demonstrated by key stakeholders will be instrumental in ensuring that these strategies yield tangible results, ultimately reinforcing Ghana’s long-term economic resilience.
