IMF calls on Ghana to arrest runaway fiscal deficit


The International Monetary Fund (IMF) has urged authorities in Ghana to sustain economic reforms in order to reduce a ballooning fiscal deficit.

An IMF mission to Ghana led by Joël Toujas-Bernaté hailed the government efforts to reduce the fiscal deficit by 3.5 percentage points of gross domestic product (GDP).

This comes after government presented 2015 budget to Parliament with a commitment to reduce the fiscal deficit by 3.5 percentage points of GDP.

The budget also includes measures to increase revenues, eliminate distortive and inefficient energy subsidies and contain growth in Ghana’s comparatively high public wage bill. At the same time, the budget allows for maintaining public investment above five per cent of GDP as well as increasing social protection spending targeted at the most vulnerable.

“The mission also welcomes the government’s aim to implement structural reforms to underpin a sustained consolidation towards a fiscal deficit objective of 3.5 per cent of GDP by 2017,” said Toujas-Bernaté.

Toujas-Bernaté added that require reforms will include strengthening public finance management, reducing tax exemptions, enhancing tax administration and reviewing the earmarking of revenues for statutory funds.

The team was in Ghana to discuss the authorities’ economic and financial program and its possible financial support by the IMF.

SOURCE

International Monetary Fund (IMF)


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