Total expenditures and arrears clearance by government by end-November 2020 amounted to Ghs 88.2 billion (22.9 percent of GDP) as against the revised target of Ghs 88.4 billion (22.9 percent of GDP) for the year.
This implies that government had Ghs 200 million more to spend for the month of December.
This is according to the Bank of Ghana’s (BoG) 98th Monetary Policy Committee (MPC) press release on Monday, February 1, 2021.
Fitch Solutions assertion of government spending a total of Ghs 92.2 billion for the 2020 fiscal year is yet to be ascertained with the release of expenditure made in the month of December 2020 by the Finance Ministry.
Governor of the Central Bank, Dr Ernest Addison, in the press release noted that total revenue and grants for the period under review amounted to Ghs 46.5 billion (12.1 percent of GDP), marginally higher than the revised target of Ghs 46.0 billion (11.9 percent of GDP).
Overall broad cash budget deficit as at end-November 2020 stood at 10.8 percent of GDP as against a revised target of 11.4 percent of GDP for the year. Primary balance, Governor Addison also noted, recorded a deficit of 4.9 percent of GDP which was marginally above the target of 4.8 percent of GDP.
Ghana’s total debt stock he added, rose to 74.4 percent of GDP (Ghs 286.9 billion) at the end of November 2020 compared with 62.4 percent of GDP (Ghs 218.2 billion) at the end of December 2019 due to an elevated fiscal path.
Of the total debt stock, domestic debt was Ghs 147.3 billion (38.2 percent of GDP), while external debt was Ghs 139.6 billion (36.2 percent of GDP).
Meanwhile, the Monetary Policy Committee (MPC) of the BoG, has once again maintained the Monetary Policy Rate (MPR) at 14.5 per cent.
This is the sixth time the MPC will be maintaining the prime rate since its reduction by 150 basis points in March last year.
Announcing the policy rate at the 98th MPC press briefing on Monday, February 1, 2021, Dr Ernest Addison noted that “given the balance of risks to inflation and growth, the Committee decided to keep the policy rate at 14.5 percent.”
With no change in the policy rate, lending rates by commercial banks to businesses will remain the same.