Ghana: Budget 2022 Highlights – Government of Ghana Fiscal Year 2022 Budget Statement and Economic Policy
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“Building a Sustainable Entrepreneurial Nation: Fiscal Consolidation and Job Creation”
At the start of 2021, Ghana, like many other countries, began charting a course for economic recovery in hopes of restoring macroeconomic stability to pre-Covid-19 levels. Despite the government’s ambition and aspirations, the country experienced a third wave of the pandemic, which again disrupted economic activities and affected households and individuals. This necessitated a greater prioritization of the health, safety and well-being of citizens, which subsequently impacted public spending.
Although we are not out of the woods yet, it looks like the economy is on a recovery trajectory, albeit at a slower pace but quite competitive compared to our peers in the sub-region. The macroeconomic growth rate at the end of June 2021 is
3.5% against a projected growth rate of 5.1% full year 2021.
On November 17, 2021, the Minister of Finance, Hon. Ken Ofori-Atta presented the budget statement and economic policy (the budget) under the theme, “Building a Sustainable Entrepreneurial Nation: Fiscal Consolidation and Job Creation” to Parliament on behalf of the Speaker, Her Excellency Nana Addo-Dankwa Akufo-Addo.
With this budget, the government seeks to support recovery efforts and restore economic growth to pre-pandemic levels while reaching a sustainable debt position.
According to the recent Population and Housing Census, Ghana’s youth cohort is growing at a breakneck pace amid high unemployment. The government intends to find innovative solutions to stem the problem of unemployment in the country. Several policies have been deployed in the past to save the employment situation by successive governments. We believe much more could be done through a collaborative effort with the private sector. Rising debt levels, which have been a major concern in the economy, call for drastic debt management measures to bring them down to sustainable levels.
To achieve and realize the objectives of the 2022 budget, the government has defined the following main areas of macroeconomic intervention:
- Ensure restoration and lasting macroeconomic stability with a focus on debt sustainability.
- Building a robust financial sector to support growth and development;
- Maintain a good balance between the implementation of the revitalization and transformation program and fiscal consolidation to foster growth in a stable macroeconomic environment;
- Provide an enabling environment for the private sector (including the promotion of entrepreneurship) for domestic businesses and foreign direct investment (FDI) to thrive;
- Deepen structural reforms to make the machinery of government more effective and efficient to support socio-economic transformation. In particular, implement reforms to increase revenue mobilization and the efficiency of public spending.
- Use digitalization to increase tax revenue, widen the tax net and control spending
We encourage the government to consolidate the gains of digitization by leveraging data to uncover predictive models and insights into key areas of economic interest for decision-making.
We also encourage the government to ruthlessly implement the policies set out to consolidate the gains made on the road to economic recovery. This should bring certainty to the business environment and ultimately stimulate job creation.
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