The Deputy Minister of Finance, John Kumah has said the concerns raised by investors over Ghana's ability to stabilise its debts have been exaggerated.
International ratings agency, Fitch, has downgraded Ghana’s Long-Term Foreign-Currency Issuer Default Rating (IDR) to ‘B-‘ from ‘B’ with a negative outlook.
The downgrade of Ghana’s IDRs and Negative Outlook reflect the sovereign’s loss of access to international capital markets in the second-half of 2021, following a pandemic-related [COVID-19] surge in government debt.
Fitch in a report said “this comes in the context of uncertainty about the government’s ability to stabilise debt and against a backdrop of tightening global financing conditions. In our view, Ghana’s ability to deliver on planned fiscal consolidation efforts could be hindered by the heavier reliance on domestic debt issuance with higher interest costs, in the context of an already exceptionally high-interest expenditure to revenue ratio.”
But speaking on JoyNews' Newsfile, on Saturday, Mr. John Kumah said Ghana has been unfairly treated.
"We sincerely believe that the concerns are being exaggerated and that Ghana particularly in this instance is being unfairly downgraded especially if the basis of the downgrade or concerns being raised is about the budget.
Let us understand that this economy recovering from Covid-19 last year, has grown on an average of 5.2 per cent."
He explained that the economy has grown over time and the Ghana Revenue Authority (GRA) has been able to raise more than its target.
"If you check the first-quarter growth from 2021, it was 3.3 per cent. Then we did 3.9 per cent. In the third quarter, Ghana grew by 6 per cent. We don't have the fourth quarter yet but we all know that due to the Christmas festivity, the fourth quarter will be the highest.
So if you take the average of the three quarters there is 5.2 per cent. The growth rate target for 2021 was 5 per cent. So if you are doing 5.2 per cent, it means you are doing well. Our budget deficit for last year was 9.4 per cent which I think we did 9.5 per cent, slightly above it.
If you look at our revenue targets, GRA was given a target of GH¢57 billion, they ended up collecting about GH¢57.3 billion. So it is an economy that is growing above 5 per cent, meeting its revenue target."
The Deputy Finance Minister, therefore, said "we don't see the basis for such an exaggerated concern."
According to Mr Kumah, the misunderstanding may be as a result of the impasse on government's E-levy Bill in Parliament that seeks to widen the country's net tax.
"Except to say that it is because of the E-levy impasse in Parliament, because of the nature of Parliamentary strength which is equal. So they are not sure about how our revenue targets are going to go in 2022, otherwise, we don't see the very basis and the fears."
Meanwhile, the Finance Minister, Ken Ofori-Atta has said that the Electronic Transaction Levy (e-Levy) Bill will be resubmitted when Parliament reconvenes on January 25, 2021.
Latest Stories
-
Gideon Boako donates 10 industrial sewing machines to Yamfo Technical Institute
10 mins -
‘Golden Boy’ Abdul Karim Razak honored at WAFU-B general assembly
24 mins -
Buipewura Jinapor secures Vice Presidential position in National House of Chiefs with record votes
34 mins -
2024 election: I want results to come out like ‘milk and honey’ – Toobu
35 mins -
Ghana’s Henry Bukari hands over chairmanship of ECOWAS Brown Card Council of Bureaux
40 mins -
Residents of Dome-Kwabenya on edge ahead of December elections
1 hour -
Moffy drops new single ‘Wo’, blending culture and modernity
1 hour -
Don’t bring soldiers to polling stations – Martin Kpebu
2 hours -
Ogyeahohuo Yaw Gyebi II retained as President of National House of Chiefs
2 hours -
Embrace ICT to fit in digital world – Ho NYA boss to youth
3 hours -
We don’t want armed soldiers at polling stations – Tanko-Computer
3 hours -
Drama as police corner armed robbers inside locked forex bureau at Lapaz
3 hours -
NEIP CEO to Kwaku Manu: You can support any political party, but stop misbehaving in NPP colours
3 hours -
30% quota for less privileged shows Free SHS is inclusive – Ofosu Nkansah
3 hours -
Nigerian-born conquers childhood hearing loss to become KNUST’s overall best graduating student
3 hours