The government has renewed its promise to maintain strict fiscal discipline and avoid the mistakes made in the last elections ahead of the 2016 polls.
“Government is not under pressure to overspend and neither are we considering any spending that will not allow the country to meet the fiscal deficits set for the year.
“Expenditures have already been rationalised to meet the crude oil prices and market financing activities have been robust enough to provide the necessary cushion to forestall any financing from the Bank of Ghana,” the statement said.
“This has been exonerated by the year to date zero financing by the Bank of Ghana,” the statement added.
Hike in wages
During the previous election in 2012, hikes in civil service wages caused the deficit to mushroom, triggering a fiscal crisis that the government is still working to overcome with the aid of an International Monetary Fund programme.
That crisis, coupled with a fall in global commodity prices, has sharply slowed growth in the country.
The statement signed by the acting Chief Director of the Ministry of Finance, Mr Patrick Nomo, said the country’s economic prospects remained on the positive trajectory with TEN oilfield commencing production in August 2016 and inflation decreasing in July to 16.7 per cent from 18.4 per cent in June.
The release stressed that the government was committed to cutting back on spending to reduce the fiscal deficit and stabilise the economy.
President John Mahama had told journalists how the government overspent its budget ahead of the 2012 elections, resulting in nearly 12 per cent fiscal deficit.
“As the economy grows you want to remunerate the public sector better to motivate them . . . you want to put in infrastructure, you want to do a lot of things . . . You can pile on debt quite quickly.
“Any shocks in the international [commodities] market affect you. And that’s exactly what happened to Ghana,” Mr Mahama said. “After 2010, we suffered a severe drop in cocoa prices . . . then the gold price collapsed . . then oil, too.”
“It [the fiscal crisis] was created by a series of factors and it is taking some time to resolve. It comes with a lot of pain and sacrifice. “But there is [now a] commitment to ensure we level out the economy and stabilise it — and keep it stable. It is something all Ghanaians are focused on and willing to do,” he said.