This is a reduction from the 73.3 percent recorded in December 2016.

The total debt stock in 2016 was at 122.6 billion cedis.

This means that the debt stock has almost hit the dreaded 70 percent of GDP, a point the International Monetary Fund (IMF) has constantly cautioned against.

The data shows that in September 2017, Ghana’s debt stood at 138.9 billion cedis representing 68.1%; the figure dropped to 137.6 billion cedis in October representing 67.4%.

But in November 2017, it went up to 139 billion cedis representing 68.1 percent.

The domestic component of debt as at December 2017 stood at 66.7 billion cedis, while the foreign debt stock was at 75.8 billion cedis.

Export Earnings

In the first two months of the year, export earnings by February 2018, reached 2.8 billion dollars.

Gold raked in a little over 1 billion dollars, while cocoa fetched cocoa 650 million dollars. Earnings from oil export also reached 664 million dollars.

On the import side, Ghana spent 2.2 billion on imports.

Banking Sector 

In the banking sector, Total Advances of banks saw a drop this year from 38.5 billion cedis in January to 35.8 billion cedis in February. Also, Banks Total Asset stood at 95.1 billion cedis, same as January this year.

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By: Lawrence Segbefia/citibusinessnews.com/Ghana

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But the Ministry of Youth and Sports has expressed discontent at how the GSS arrived at the figure.

Speaking at a consultative forum to establish the Sports Fund, the representative of the Ghana Statistical Services, Asuo Afram, who was brought in to quantify the contribution of sports to the country’s GDP, shocked the audience when he revealed that his department estimates the contribution of sports at 1.4%.

“If you take sports, we count sports under recreation and recreation contributes around 3.7% to the GDP.

And under recreation, we have estimated that sports contributes about 1.4% of the 3.7% that recreation contributes,” he said.

Pressed on how the GSS arrived at the estimate, Afram revealed that, among other things, the GSS takes into consideration the budgetary allocation for sports as basis for arriving at their figure.

His response drew fire from the Deputy Minister of Youth and Sports who is the Chairman of the National Sports Fund Committee who said his ministry will look into investing in an independent research institution to properly quantify the contribution of sports to the GDP.

“I think we can all see that this estimation of the contribution to sports is not scientific. Going forward, I think we need an independent ministry-sponsored scientific research into sports’ contribution to the GDP so that we can have verifiable scientific data to work with,” he said.

The Sports Fund Consultative Forum is aimed at building a proper framework towards the establishment of a sports fund that will help solve the country’s chronic financial deficit in the sports sector.

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By: Fentuo Tahiru/citifmonline.com/Ghana

The post Sports contribution to GDP 1.4%; MOYS disputes figure appeared first on Citi 97.3 FM - Relevant Radio. Always.

His question to President Akufo-Addo was at the president’s maiden media interaction at the Flagstaff House on Tuesday to mark the government’s 6th month in office.

Nana Akufo-Addo deferred answering the question to Dr. Bawumia.

Below is what Bernard asked and how Dr Bawumia answered:
Bernard Avle

Good afternoon, my name is Bernard Avle, I work at Citi FM. Mr President, I remember during the campaign, yourself and the Vice President expressed worry about the level of debt that Ghana was incurring and among other things you said that because of the mismanagement we were having to borrow and then we have enough internal resources and therefore we should block the loopholes.Permit me to give you some figures, in March this year we went for Ghc1billion 3-year bond.
In April a $2.25billion dollar bond which translates into Ghc10.25 was announced. In the same month, we announced a $2.4million bond to clear legacy debts in the energy sector, translates that to Ghc12billion.Last week we were told there is a Ghc17.4billion bond being sought for T3.
Putting all the figures together in Ghana cedis, that’s about Ghc40billion if all these bonds go through.The last time I checked our GDP was about Ghc80billion. If within the first quarter of the first year we are already borrowing up to half of our GDP. Where are the internal resources, how much resources have you generated internally, why are we still borrowing this much. Thank you.

Dr Alhaji Mahamudu Bawumia

Thank you very much, Bernard asked a question about the debt and how it appears to be increasing. I think we have to go back a little bit. You saw that last year the deficit was 9.4 per cent of GDP, that’s where it ended and thanks to the Asempa budget, we’ve gone back on the path of fiscal consolidation to bring back the deficit this year to 6.5percent of GDP.

Now in doing so, you are going to be bringing down the debt stock in the process. I will also let you know that in the last 4years between 2012 and 2016, the debt stock went up from 45 percent of GDP to 72 per cent of GDP. That means on average, every year the government was adding 6.75 per cent of GDP to the debt stock.

Now the GDP is not Ghc80billion as you quote but closer to Ghc200billion this year. And we are going to end the year, after inheriting about 72 per cent of GDP, we are hoping to bring it down slightly between 70 and 71 per cent of GDP. So we are looking at how we manage the finances to bring down the debt burden.

So even if you are borrowing, the burden of that, we are trying to bring down through the process of consolidation. The Finance Minister is here, he is keeping all of us in line. What happened before with this unbridled borrowing, you find out that we owe so many contractors who have not been paid and so on.

Today the GIFMIS system is really working, it is not possible to circumvent it and so if there is no money, you are not going to be entering into that contract in the first place and so this is actually helping us as you see, very much on target as far as our deficit is concerned for example through the first half of the year and I think that this is also seen in the domestic money market where you have seen interest rates coming down from 22 per cent last year, and just a year later, you have 11.9 per cent

And If you are borrowing rampantly in the domestic market, you will see that interest rate decline. So the simple answer is that, the debt stock in terms of its impact is burdened on the economy is not actually increasing. The debt to GDP ratio is actually stabilising and we are hoping to bring it down by the end of the year even if marginally. Thank you very much.

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By: citifmonline.com/Ghana

The post Bernard Avle’s question on borrowing and how Dr Bawumia answered it appeared first on Citi 97.3 FM - Relevant Radio. Always.

According to him, more is needed in the government’s quest in addressing the country’s challenges through research and innovation.

[contextly_sidebar id=”mmm1UxRocF2WDNaLSv2x5uxsbrfLbgwd”]“To do the things that we want to do in research, we need money and as at now, the money that is given for research is just about 0.025 percent of our GDP. And that is not enough to pay the scientist much more to undertake research.”

Speaking at Citi FM’s Innovation Summit on Saturday, Prof. Frimpong Boateng also called on the President to fulfill his promise of assigning one percent of GDP to his sector.

“…The President, Nana Addo Dankwa Akufo-Addo has said that he will start by devoting one percent of GDP into research and that is very good news indeed. And he put me at the ministry to do things for him; I’m serving at his pleasure. So I will remind him all the time of his promise to enable me function as a scientist and a doctor in that respect,” he added.

Prof. Frimpong also noted that when his ministry is allocated with enough resources then “we can serve all the research institutions in Ghana and make sure that we have the funds to do what we want to do.”

Meanwhile, some participants at the Innovation Summit were not happy for the 0.025 percent allocation to research describing it as paltry.

According to them, even the one percent the President promised is also too small charging government to increase it to encourage more people to undertake research and innovation.

The theme for the 2017 edition is “Creating Our Future”.

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By: Godwin Akweiteh Allotey/citifmonline.com/Ghana
Follow @AlloteyGodwin

The post Prof. Frimpong laments 0.025% GDP allocation for research appeared first on Citi 97.3 FM - Relevant Radio. Always.

This is compared with the 2016 GDP, based on the provisional out-turn for the first three quarters of the period, which is estimated at 3.6 percent, with the non-oil real GDP estimated at 4.6 percent.

Presenting the budget in parliament today [Thursday], Finance Minister, Ken Ofori-Atta, stated that government will work at achieving its macroeconomic targets to improve the lives of Ghanaians.

He announced that, government has projected an end-of-year inflation of 11.2 percent, while overall fiscal deficit is pegged at 6.5 percent of GDP.

“We believe strongly that, our medium-term policies, anchored on fiscal discipline, a broadened tax base, elimination of wasteful expenditures, prudent debt management strategies, complementary monetary policy, and sustainable external balance, will ensure even better macroeconomic outcomes in the medium-term,” he said.

Touching on total expenditure for the year 2017, (including provision made for the clearance of arrears and outstanding commitments), Mr. Ofori-Atta announced that, government estimates  GH¢56.5 billion, equivalent to 27.8 percent of GDP.

“The estimated expenditure for the year represents a 21.0 percent increase over the provisional outturn for 2016. Of this amount, GH¢3.7 billion, equivalent to 1.8 percent of GDP and 6.6 percent of total expenditure will be used for the clearance of arrears and outstanding commitments”.

On debt, he disclosed that, the total public debt stock as at end 2016, stood at 73.3 percent of GDP up from 71.63 percent in 2015.

“This was due to the larger than expected fiscal deficit and financing requirement in 2016. Domestic and external debt stood at 32.02 percent of GDP and 41.29 percent, respectively,” he said.

In nominal terms, Mr. Ofori-Atta stated that, the public debt stock as at end 2016 stood at GH₵122.3 billion (US$29.2 billion), with domestic and external debt of GH₵53.4 billion (US$12.8 billion) and GH₵68.9 billion (US$16.5 billion), respectively.

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By: Lawrence Segbefia/citibusinessnews.com/Ghana

The post Economy projected to grow by 6.3% in 2017 appeared first on Citi 97.3 FM - Relevant Radio. Always.

Speaking at a lecture titled, ‘The State of the Ghanaian Economy – A Foundation of Concrete or Straw’, chaired by Former President John Agyekum Kufuor, Dr. Bawumia among others accused government of failing to put to good use the huge loans it has contracted.

[contextly_sidebar id=”pujk3WGQfPcc5KjJOJTWvNl9I8UiESS4″]“By the end of 2008 following the adoption and implementation of the HIPC initiative, the government’s policy framework of fiscal discipline, the country’s debt to GDP ratio, had declined from 189% in 2000, to 32% of GDP by 2008. Indeed from independence in 1957 to 2008, Ghana’s total debt was 9.5% Billion Cedis; however; in the last seven years alone under this NDC government, Ghana’s total debt has ballooned from 99.5 billion cedis to 100 billion cedis in 2015; and a 105 billion cedis by May 2016. In fact, 66% of Ghana’s debt from independence; has been accumulated under the presidency of John Mahama in just the last three and half years.”

Dr. Bawumia, who has constantly lambasted the government’s excessive borrowing explained that, “in terms of the of the dollar equivalent of the borrowed amount, this government has borrowed some 39 billion dollars in eight years. When I mention this, they either get confused or pretend to get confused; so for the sake of clarity, I have put in this document a table that shows them clearly the dollar equivalence of all the amounts borrowed from 2009 to 2016. In fact by December 2016, the government would have borrowed $42 billion dollars. The government would claim no doubt, that the book value of the debt is $26 billion dollars; but quite frankly that’s a weak argument. The only reason why the book value of the debt is $26 billion is because we are applying today’s exchange rate which the same government succeed in collapsing to the value of the debt; and not the exchange rate at the time the money was borrowed. With this major increase in the debt, Ghana’s debt to GDP ratio has increased from 32% in 2008, to 72% at the end of 2015.”

Finance Minister lied about Ghana’s GDP ratio – Bawumia

Dr. Bawumia accused the Finance Minister Seth Terkper of massaging debt to GDP ratio figures during his presentation of supplementary budget in July this year.

“Interestingly, in the presentation of the supplementary budget in July 2016, the Minister of Finance stated that Ghana’s debt to GDP ratio had declined from 72% in 2015 to 63%. Unfortunately and sadly this is untrue. The calculation of the debt to GDP ratio used by the Minister is just playing wrong and misleading. The government has taken the total debt stock in May 2016, and divided it by the projected GDP in December 2016, to arise at the debt to GDP ratio is 63%. This is statistical gimmickry. If you ask the Minister about how he achieved this dramatic reduction in the debt to GDP ratio in either January or May 2016, he will be unable to tell you. All that has happened is that, he has used a higher projected GDP number to do the calculation.”

Dr. Bawumia said such excessive borrowing and the subsequent mismanagement of the economy, is to blame for the increasing levels of unemployment.

According to him,  the amount borrowed by the NDC administration since 2009, does not commensurate with the government’s claim of massive infrastructure development. According to the economist, the total cost of infrastructure from loans, grants and taxes from 2009 to date, is less than 7 billion dollars.

He thus questioned what the rest of the money has been used for.  “So where’s the rest of the money?” he asked.

According to Dr. Bawumia, a large chunk of the money has been wasted through over-bloating of project cost and corruption.

Dr. Bawumia also outlined government’s failures in the management of interest rates and its impact on businesses and the banking sector, the energy sector among others.

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By: Ebenezer Afanyi Dadzie/citifmonline.com/Ghana
Follow @AfanyiDadzie

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