<\/p>\n
Economist with Databank, Courage Martey has reiterated calls for government to hasten the pace of fiscal consolidation in the short to medium term.<\/p>\n
In an interview with <\/strong>, the economist said this will restore the country back above the current downgraded position that the country is facing.<\/p>\n His call comes as international ratings agency, S&P Global Ratings, last week revised Ghana\u2019s rating from B-\/B to CCC+\/C, a situation that threatens Ghana\u2019s debt sustainability efforts with investors demanding higher credit risk premium.<\/p>\n \u201cThere are a number of things that need to be done for us to get an upgrade. It significantly hinges on rebuilding fiscal and external buffers because that has been the main point of concern for investors.\u00a0 There must be an improvement in our fiscal deficit position. Now, if you look at the S&P statement, for instance, they essentially considered the need to record a primary surplus equivalent to 2% of GDP.\u201d<\/p>\n \u201cThat is a tall order though government has already signalled that it is working to record a primary surplus equivalent to 0.4 worth of GDP. We are not far from the direction that the fiscal situation should be heading, except that it is moving slower than the rating agencies would anticipate. Thus, government should be able to quicken the pace of fiscal consolidation. That would be good news towards, reinstating us back above the current downgraded levels we have found ourselves in,\u201d he said.<\/p>\n S&P Global Ratings said though government has taken steps towards consolidating the fiscal deficit, including the recent passage of the Exemptions bill, high borrowing costs and softening growth make it difficult to put debt to GDP on a downward path.<\/p>\n After a careful assessment of the economy, S&P also reviewed the country\u2019s economic outlook to negative. The negative outlook, in a statement issued by S&P on Friday, August 5, 2022, reflects Ghana\u2019s limited commercial financing options, and constrained external and fiscal buffers.\u201d<\/p>\n S&P Global Ratings also noted that the Covid-19 pandemic and the Russian invasion of Ukraine have worsened Ghana\u2019s fiscal and external imbalances.<\/p>\n Demand for foreign currency has been driven higher by various factors, including non-resident outflows from domestic government bond markets, a lack of access to Eurobond markets, retail dollar purchases, dividend payments to foreign investors and higher costs for refined petroleum products.<\/p>\n Currently, the local currency which has seen a sharp depreciation in recent times is nearing \u00a29 to one US dollar.<\/p>\n It would be recalled that government earlier this year introduced some revenue generation measures such as the E-Levy, the Tax Exemptions Bill, some cuts in discretionary spending.<\/p>\n However, S&P notes that while these changes could improve revenue generation going forward, the situation remains challenging.<\/p>\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":" Economist with Databank, Courage Martey has reiterated calls for government to hasten the pace of fiscal consolidation in the short to medium term. In an interview with , the economist said this will restore the country back above the current downgraded position that the country is facing. His call comes as international ratings agency, S&P […]<\/p>\n","protected":false},"author":1,"featured_media":1170041,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[72],"tags":[13404,2144,3367,2524,22649],"class_list":["post-1170039","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-consolidation","tag-downgrade","tag-fiscal","tag-pace","tag-quicken"],"_links":{"self":[{"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/posts\/1170039","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/comments?post=1170039"}],"version-history":[{"count":0,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/posts\/1170039\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/media?parent=1170039"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/categories?post=1170039"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/tags?post=1170039"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}