UK Cuts Aid To Ghana

John Benjamin, UK High Commissioner to Ghana

The United Kingdom (UK) has stopped funding projects and programmes that government wants to undertake.

The UK, over the years, has been one of the biggest donors of development aid and budgetary support to the country.

The disclosure is coming after a similar move by the European Union (EU), whose head of delegation, William Hannah said the Union now wants to focus on more sector-specific programmes.

UK High Commissioner to Ghana, Jon Benjamin, explained that the decision was mainly due to Ghana’s new status as a low middle-income country.

“Being classified as a lower middle-income country is no longer a least developed country, and Ghana’s economy is still developing. Budgetary support to Ghana is no longer on the cards because the government of Ghana is supposed to provide its own basic services,” he said.

However, he said the UK will still provide technical service and support private sector, particularly SMEs to grow and develop so they can become the motor of employment creation and growth in the future.

According to him, the nature of the aid programme is changing and it has to change over time, adding that there won’t be any budgetary support in any form again.

“That era has come to an end, and of course if the Ghanaian economy under any government continues to grow four or five, six or seven percent, then 10 years from now, it would be such a bigger economy that it shouldn’t be needing a huge amount of aid,” the Commissioner said.

“President Mahama has said himself in New York that what African countries need is not more aid but trade because ultimately it is the trade that creates the jobs and the spaces,” he explained.

The development could put pressure on government to look for alternate ways of funding most of its projects outlined in the budget.

This could possibly lead to more taxes or hikes to address this challenge, or government has to cut its expenditure to help manage the situation.