Ghana�s Target to narrow her fiscal deficit to 6.5 percent of Gross Domestic Product (GDP) in 2015 from 9.5 percent has been described as �exceptionally ambitious.�
Carmen Altenkirch, Director of Fitch, who stated this at a press conference in London at the weekend, remarked: �I�ve penciled in a figure of 8 percent.�
�The real challenge for them will be raising revenue at a time when the economy isn�t performing well.�
She also added that Ghana and the International Monetary Fund (IMF) probably would not come to an agreement on aid until April and therefore the country will struggle to meet revenue targets next year.
Lower earnings from exports and higher spending weighed on the budget and added pressure on the cedi, the continent�s worst performing currency this year.
Rising debt, power shortages and soaring inflation prompted Ghana�s economic managers to open the door to IMF aid in August.
The government would probably finish talks with the lender by February, James Klutse Avedzi, Chairman of the Finance Committee in Parliament, was quoted as saying on November 19, this year.
�The first time, all things going well, that we�re likely to see an IMF programme is April next year,� Altenkirch said, without giving details.
�If they don�t have an IMF programme, they won�t be able to issue another Eurobond. Then, you�re going to get a very large drain on reserves.�
Ghana sold $1 billion of January 2026 bonds, priced to yield 8.25 percent, in September, according to data compiled by Bloomberg. That was its third offering in dollars and was issued a few weeks after signaling it wanted IMF aid. The country�s international bonds returned 8.7 percent this year, less than the 10.4 percent average gain for the Bloomberg USD Emerging Market Sovereign Bond Index.
After losing access to domestic capital markets, Ghana was forced to borrow money from the Central Bank, according to Altenkirch.
�Banks have become net sellers of government paper, while non-banks have purchased only half of what the government was intending,� she said.
The cedi, which is down 26 percent this year, weakened 0.4 percent to 3.2152 per dollar by 5 p.m. Friday in Accra.
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