Ken Ofori-Atta
Government has stated that it has rejected almost half of the huge outstanding payments and claims submitted to it for settlement this year, thanks to an audit by the Auditor General.
Minister of Finance, who disclosed this Wednesday in Accra, said the public purse was abused in recent years.
“We have moved on. The validated claims would be cleared in line with government’s macroeconomic programme for the medium term,” he told Parliament.
Arrears clearance
In line with an arrears clearance programme with the International Monetary Fund under the Extended Credit Facility (ECF), he said a total amount of GH¢3,220.3 million was programmed for clearance in 2017.
Of this amount, GH¢2,287.8 million was cleared by the end of September 2017.
Public Debt
He also mentioned that Ghana’s debt to GDP ratio declined from 73 percent at the end of December 2016 to 68.3 percent as at September 2017, including the interest burden of Ghana’s debt.
“Interest payments have reduced from 45 percent of tax revenue to 43.8 percent in September 2017 with a projected 41.9 percent reduction at the end of 2017.”
Energy sector levies
“The ESLA has contributed to paying VRA and TORs debt owed to banks and trade creditors to the tune of GH¢1.9 billion. Government transferred an amount of GH¢484.3 million to partially settle foreign exchange under-recoveries owed the Bulk Oil Distribution Companies (BDCs), support the Strategic Stock Reserve Programme of Government and to subsidise premix and residual fuel oil.”
GDP
The real GDP growth for 2017 is provisionally estimated at 7.9 percent, with non-oil GDP growth of 4.8 percent.
At the sectoral level, the industry sector recovered from a negative growth of 0.5 percent and is expected to grow by 17.7 percent in 2017 due to increased production in upstream oil and gas.
Inflation
Inflation declined from 15.4 percent in December 2016 to 11.6 percent in October 2017 despite the occasional marginal upticks.
Credit to private sector
Total credit to the private sector and public institutions recorded a growth of 16.8 percent in September 2017 of which the private sector accounted for 87.9 percent.
Interest rates
The Monetary Policy Rate (MPR) was reduced from 25.5 percent in January 2017 to 21.0 percent in July 2017. Similarly, money market interest rates broadly declined.
The average lending rates of banks eased to 28.9 percent in September 2017 from 31.7 pecent in December 2016.
Exchange rate
As at October 2017, the Ghana cedi had cumulatively depreciated by 4.0 percent against the US dollar compared to 4.3 percent in the same period last year.
External developments
The Balance of Payments (BOP) recorded a surplus of US$379.3 million for the first three quarters of 2017 compared with a deficit of US$1.3 billion in 2016.
This improvement was mainly driven by higher export earnings and private transfers.
The Gross International Reserves, as at end September 2017, stood at US$7.2 billion, equivalent to 4.1 months of import cover.
This compares favourably with an outturn of US$4.8 billion, equivalent of 2.5 months of import cover for the same period last year.
Fiscal developments
Total Revenue and Grants for the period fell short of target by 9.3 percent (an actual of GH¢28.4 billion, against a target of GH¢31.3 billion), while Total Expenditure (including arrears clearance) fell short of target by 8.1 percent (an actual of GH¢37.7 billion, against a target of GH¢41 billion).
This resulted in an overall fiscal deficit on cash basis of 4.6 percent of GDP against a target of 4.8 percent of GDP.
Petroleum receipts
Total petroleum receipts (i.e. proceeds from liftings and other petroleum receipts) as at September 2017 was US$362.6 million (GH?1,552.1 million), compared with the receipts of US$172.9 million (GH?671.5 million) for the same period in 2016.
By Samuel Boadi