Ghana con­sid­ers law to limit fis­cal deficit to 5%

Kuwait Times - - BUSINESS -

Ghana is con­sid­er­ing pass­ing a law that will re­strict gov­ern­ment’s fis­cal deficit to not more than 5 per­cent of GDP, the coun­try’s Se­nior Min­is­ter Yaw Osafo-Maafo said yes­ter­day.

The pro­posed Fis­cal Re­spon­si­bil­ity law will have pro­vi­sions to pun­ish gov­ern­ment of­fi­cials who ex­ceed spend­ing lim­its, OsafoMaafo told a meet­ing of busi­ness lead­ers in the cap­i­tal Accra. Ghana, which ex­ports co­coa, gold and oil, is fol­low­ing a three­year pro­gram with the IMF to re­store fis­cal bal­ance to an econ­omy dogged by a high fis­cal deficit and large pub­lic debt, af­ter a pe­riod ex­u­ber­ance dur­ing the oil boom years. “We are propos­ing a Fis­cal Re­spon­si­bil­ity Law that will re­strict gov­ern­ment spend­ing within a band of 3-5 per­cent fis­cal deficit-any­thing above five per­cent should be con­sid­ered as an in­fringe­ment,” Osafo-Maafo said. The gov­ern­ment of Pres­i­dent Nana Akufo-Addo, which as­sumed of­fice in Jan­uary, plans to lower fis­cal deficit to 6.3 per­cent in 2017, from 9.3 per­cent in 2016.

“The essence of the law is to get the econ­omy back on track and make it im­pos­si­ble for any gov­ern­ment to re­verse the mo­tion ... so peo­ple who break the limit would be made to suf­fer for it,” he added. — Reuters

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