General News of Saturday, 19 July 2014
Economist and Lecturer at the University of Ghana Business School, Godfred Alufa Bokpin says Government targets in the 2014 budget were dead on arrival.
According to him, it is obvious government was going to miss the budget target: "Government’s mid-year review of the budget was expected;…Two months into the budget [2014 budget] life, we knew that those targets were not realistic; government wasn’t going to achieve those targets. Is as though one could say that they were dead on arrival,’’ he noted.
He explained that the government’s inflation target of 9.5 percent amongst others could not be achieved: "by the middle of the year, because the variants had exceeded the lower band.’’
Speaking on the Citi FM’s News Analysis Programme The Big Issues, Mr. Bokpin said the mid-year review of the budget was expected.
He cautioned the Finance Ministry and government to set realistic targets and projections. "It doesn’t send a good signal to the corporate and foreign investors that government will set a target and by the middle of the year the variants have exceeded the lower band of that target,’’ he added.
Finance Minister Seth Terkper on Wednesday presented a review of the 2014 budget to Parliament with a new supplementary budget to the house for approval.
But Mr. Bokpin said even the supplementary budget presented was one-sided, "it is one-sided, it’s basically expenditure,’’ he opined.
"The Supplementary budget, the review and all of that is expected, but they are not actuals; we must have a clear strategy to translate this budget into actuals; otherwise next year, we will still be here and even the revise targets we may miss it,’’ he said.
The Finance Minister asked parliament to approve a Ghc3,196,855,671 supplementary budget estimate in conformity with Article 179(8) of the Constitution, for the rest of the year.
Government reviewed its overall real GDP growth (including oil) target from 8% to 7.1%.
The non-oil real GDP growth has been revised from 7.4 percent to 6.6 percent.
As part of the review of a number of macro-economic targets, inflation rate target for the year has been reviewed to 13.0±2 percent from 9.5 ±2 percent.
The overall budget deficit target has been revised from 8.5 percent of GDP to 8.8 percent and Gross International Reserves of not less than 3 months of import cover of goods and services.