Ghana on Track to Achieve 0.5% Primary Surplus By End-2024 – Dr Amin Adam
Finance Minister, Dr. Mohammed Amin Adam, announced that the country is on course to achieve a primary surplus of 0.5 percent of GDP by the end of the year, consistent with its program with the International Monetary Fund (IMF).
This statement was made during the presentation of the 2024 Mid-Year Budget Review in Parliament on Tuesday.
“We have reined in expenditures to ensure we are within the 2024 Budget Appropriation and exceeded the mid-year revenue target by 0.2 percent by end-June, 2024. In effect, Mr. Speaker, we are living within our means. Indeed, consistent with our programme with the IMF, we are on course to achieving a primary surplus of 0.5 percent of GDP by end of the year,” remarked Dr. Amin Adam.
Macroeconomic Performance Highlights:
- Exceeding Growth Expectations: The Ghana Statistical Service reported a 4.7 percent growth rate for Q1 2024, surpassing the revised target of 3.1 percent.
- Declining Inflation: The end-June inflation rate was 22.8 percent, a reduction of 31 percentage points since December 2022, indicating that the target threshold of +/-2 of 15 percent by the end of 2024 is attainable.
- Stable Exchange Rate: The cedi’s depreciation rate against the US Dollar was 18.6 percent as of June 2024, improving from 22.0 percent recorded in the same period last year.
- Improved International Reserves: Gross international reserves reached 3.1 months of imports at the end of June 2024, up from 2.5 months in the same period last year.
The Finance Minister also highlighted several key fiscal achievements under the IMF programme:
- IMF Programme Success: The second review of the Extended Credit Facility with the IMF was completed, leading to a disbursement of $360 million, bringing total IMF support to approximately $1.6 billion.
- Official Debt Relief: The debt restructuring programme with the Official Creditor Committee (OCC), covering $5.1 billion, will provide about $2.8 billion in debt relief, suspending debt servicing to official creditors from 2023 to 2026.
- Eurobond Agreement: Ghana has concluded negotiations with Eurobond holders covering $13.1 billion, leading to the cancellation of $4.7 billion of debt and providing $4.4 billion in debt service relief between 2023 and 2026.
- Power Sector Savings: Successful negotiations with five of the seven Independent Power Producers (IPPs) will result in $6.6 billion in savings over the lifespan of the Purchasing Power Agreements (PPAs).
“Mr. Speaker, it is evident that we are on the right trajectory. The economy is rebounding stronger than anticipated. The choices we have made and the policies we are implementing are yielding results. We have reversed the negative trends, all the indicators are looking better. I want to assure you that we will stay on this path and continue to make the right choices. Our economic recovery is fast and strong,” the Minister stated.
