Revenue and expenditure for the second quarter of the year fell below the target. Dr Kofi Wampah, Governor of Bank of Ghana (BoG), at the close of a Monetary Policy Committee meeting, told journalists in Accra that government’s budget recorded an overall deficit (cash basis) of 4.5 percent of GDP.

He said total revenue and grants recorded GH¢9.5 billion as against a target of GH¢10.6 billion, adding that of the outturn domestic revenue amounted to GH¢9.0 billion below the target of GH¢9.8 billion.

He said total tax revenue amounted to GH¢6.7 billion compared to the target of GH¢7.7 billion. Dr. Wampah said that the development was as a result of underperformance of almost all the tax types which reflected lower imports and energy sector challenges, stating that grant disbursements amounted to GH¢507.6 million, 41.8 percent below target.

Non-tax revenues for the period amounted to GH¢2.2 billion higher than the budget target of GH¢2.0 billion while total expenditures, including payments for the clearance of arrears and outstanding commitments for the first half of 2013 amounted to GH¢13.5 billion compared to a target of GH¢14.6 billion.

Dr. Wampah said the deficit of GH¢4.0 billion was financed mainly from domestic sources, resulting in a net domestic financing (NDF) of GH¢3.0 billion. He said this was lower than the budget target of GH¢3.2 billion, adding that foreign financing of the budget amounted to GH¢1.0 billion. The stock of public debt also increased to GH¢39.1 billion (43.9 percent of GDP) as at the end of June 2013 from GH¢35.1 billion in December 2012.

“Out of the total public debt stock, the domestic component amounted to GH¢20.9 billion compared to GH¢18.5 billion in December 2012. External debt stock also stood at US$9.3 billion up from US$8.8 billion over the same period,” Dr. Wampah said.

The Governor added that BoG maintained its policy rate at 16 percent for the first time this year. The policy rate is the rate at which the Central Bank lends to commercial banks.