Ghana’s finance minister, Seth Terkper is expected to present a supplementary budget and a mid-year budget review to Parliament on Monday July 25, local media report.
The minister is expected to review most of the macroeconomic targets set out in the 2016 budget he presented to parliament in November last year.
The Reuters news agency last Monday reported that Ghana had cut its economic growth forecast for 2016 down from 5.4 percent to 4 percent. The revision, the Minister explained was due to lower export prices and irregular oil production.
Ghanaian news portal, myjoyonline.com, reports that the country’s end of year inflation target of 10.1 percent, fiscal deficit of 5.3 percent as well as revenue target of Ghc38 million are all expected to be reviewed during the Terkper’s presentation on Monday.
The website also reports that the government will seek parliamentary approval for some new spending from new revenues that have come in as a result of the energy sector levy.
The Finance Minister will seek approval from the legislature to spend some funds on restructuring a substantial portion of debts owed by the Volta River Authority (VRA) and legacy debts in the energy sector, the portal reports.
Ghana which started producing oil commercially in 2010 has seen its output drop following a breakdown on a production ship in the offshore Jubilee field which led to a halt in production between March and May this year. The halt in production led to the loss of millions of dollars in revenue.
The supplementary budget will give details on revenue raised for the first half of the year and possibly revise the target for the rest of the year. It will also provide details on the government’s expenditure for the first half of 2016 as well as for the final half of the year.
As Ghana holds presidential and parliamentary elections later this year, many will expect the Finance Minister to spell out policies that will show the government’s commitment to stabilizing the economy.
Some economists according to myjoyonline.com expect the Minister to provide an update on the International Monetary Fund’s (IMF) program which aims to restore fiscal balance and spur growth as well as plans to raise the country’s fourth Eurobond possibly in the last quarter of the year.
Growth in the west African country dropped to 3.9 percent in 2015 from 14.4 percent in 2011, a year after commercial oil production began.