The Government of Ghana is developing new options that would allow both public and private sectors to share the responsibility of financing infrastructural development.
The Vice President, Paa Kwesi Bekoe Amissah-Arthur, who made the announcement in Accra on Thursday, said current challenge facing Ghana in achieving sound and stable macro environment, was how to extend the nation’s fiscal space, through public expenditure rationalization and revenue mobilization.
“But is through achieving that vital condition that we are able to support health and education and shield the most vulnerable from adverse economic and financial shocks,” the Vice President said.
Vice President Amissah-Arthur was giving an opening remark at the launching of a report on the bi-annual Regional Economic Outlook (REO) of Sub-Saharan Africa, published by the International Monetary Fund (IMF), in Accra.
He said to develop societies and further reduce poverty, there was the need for a better understanding of how to strengthen the growth momentum in a multi-speed and tentative world.
“We need to strike a balance between creating fiscal space and rebuilding macro-economic benefits, between investing in critical infrastructure and the commitment to achieving the Millennium Development Goals (MDGs),” the Vice President said.
He announced that Ghana was in the process of issuing a second Eurobond to restructure her debt, reduce the interest burden on the budge to enable the financing of critical infrastructure projects, noting however that exchange risk was a major problem in those transactions.
Government, the Vice President said, would examine cheaper options of financing its infrastructure.
Vice President Amissah-Arthur noted that the common themes that had emerged in the REO for Sub-Saharan Africa over the last few years had been accounts for growth and change, resilience in the face of external shocks, commodity price declines and climate change and accounts of improving economic management and governance.
The IMF, through the REO, reports the transformation of African economies poverty reduction, job creation and sustainable growth, and the Outlook reinforces Africa’s growth story that it would continue to post a high economic growth estimated at 5.4 per cent, well above the three per cent projected for the global economy.
The Vice President noted that there were however risks of uncertain global conditions and many African countries were yet to build on their macro-economic buffers to the levels prior to the intervention of the global crisis.
“Because Africa has a lot more catching up to do, the weak external environment presents a significant challenge to sustaining growth,” Vice President Amissah-Arthur said, and commended the African Department of the IMF for the report, which he said, provided investors with frank assessment of the challenges the continent face.
The 104-page report was in four chapters with headings “Building Momentum in a Multi-Speed World,” “Strengthening Fiscal Policy Space,” “Issuing International Sovereign Bonds: Opportunities and Challenges for Sub-Sahara Africa,” and “Reforming Energy Subsidies.”
It also has a statistical appendix, references and publications of the IMF African Department, 2009-13.
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