The Former minister of finance, Mohammed Amin Adam has asserted that the 2025 Budget Statement and Economic Policy of Government presented by the currentt Finance Minister Dr. Ato Forson lacks credibility in many ways saying “budget cannot deliver growth example, a criminally mismanaged economy – 5.7% growth verses reset economy is 4%”
Opening the debate on the budget, Dr. Amin raised many credibility issues in the budget due to what he called inconsistencies and underfunding of priority initiatives – Initiatives rely on G&S, which are heavily underfunded, submitting that, “Appropriation GHs6.9 billion verses Expenditure allocations to MDAs GHs22 billion. A shortfall of GHs15 billion How can the government fulfill its promises?”
The MP said, the credibility of the budget is further questioned by the fiscal balances announced in the budget both for the 2024 outturn and the projections for 2025 because, “a deficit of 7.6% for the overall fiscal balance on commitment for 2024 and a deficit primary balance of 3.6% on commitment for 2025”, as he anchored his debates these points said these do not reflect the true fiscal performance of the economy:
o The IMF now demands, as part of the Fund program condition, a comprehensive audit of the famous GHs49 billion used to determine the fiscal balances to ensure that the flow effect and the stock effect are consistent with the program primary fiscal balance.
o The Hon. Minister himself stated in paragraph 135 of the budget that he is yet to audit these outstanding claims.
o How the Minister could use unaudited claims to determine fiscal balances which have serious implications for the economy surprises me.
o Ghana already suffering from financial losses
Ghana’s sovereign spreads, our cost of borrowing is now in the range of 700bsp, when they were in 500bsp 3 months ago and even going downward then
Bloomberg on the same day the Budget was presented reported that just by announcing Ghana missed the primary fiscal target, Ghana’s Dollar bonds due 2035 declined 1.8%. Notes maturing in 2029 fell 1% on the dollar.
How can we do this to ourselves? This demonstrates lack of confidence in the economy by international markets.
He concluded that, “this budget lacks credibility. The very foundation of this budget is wobbling, and cannot stand the test of time, and many Ghanaians particularly the youth of this country will be disappointed by the time this budget is fully implemented in its current state”.
By Edzorna Francis Mensah.
