- The Institute of Fiscal Studies (IFS) has advised the government to ensure it fixes Ghana's economy
- It added that there is an urgent need to end populism and implement urgent measures to restructure the economy
- The IFS added that Ghana's economy was in a delicate state even before the outbreak of COVID-19
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The Institute of Fiscal Studies (IFS) has called on the government to end its populist agenda and fix Ghana’s economy.
It argued that the economy is currently in a fiscal mess and there is the need for urgent measures to restructure it.
The Institute went on to say that given the outbreak of the coronavirus, the government needs to ensure that the situation is not worsened.
Per a report by graphic.com.gh, the Director of the Institute, Dr. Said Boakye, noted that Ghana’s fiscal position was already in a delicate situation before the outbreak of the coronavirus.
In that respect, Ghana was heading for serious challenges even without unexpected disasters.
According to the IFS, the government, in 2019, was able to collect GHc53.38 billion in total revenue and grants, representing 15.3% of the Gross Domestic Product (GDP).
This, it explained, was 1.8% points below the initial budget forecast of 17.1% of GDP.
The IFS added that the government, however, spent GHc31.01 billion to service its debt alone, which was GH¢19.77 billion in interest payment and GH¢11.24 billion in principal repayment.
It again revealed that the government spent GHc22.22 billion as employee compensation in 2019.
Consequently, the sum of these two expenditure items alone stood as high as GH¢53.23 billion, representing 99.7% of the total revenue and grants.
In other news, the Minister of Finance, Ken Ofori-Atta, has revealed plans by the government to increase revenue mobilisation and the tax-to-GDP ratio.
YEN.com.gh understands that the intent is to push the ratio from the current 13 percent to 20 percent.
This, he said, would be possible if mobilization of revenue is increased and the economy is digitalised.
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