Business News of Friday, 28 February 2003

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The Hon.Minister of Finance, Mr. Yaw Osafo-Maafo has presented the 2003 Budget Statement to Parliament(full text).


687. Mr. Speaker, in the year 2001, the budget aimed at stabilizing the economy by bringing down inflation, killing the inflation psychology, minimizing the risk of foreign exchange losses and the various economic uncertainties that are detrimental to our individual planning and private sector growth.

688. In 2002 we began our transition from stabilization to growth and poverty reduction. We met several challenges, but we made notable progress on many fronts.

689. This year, we are continuing the stabilization effort and also accelerating our pursuit of growth and poverty reduction and towards the HIPC completion point.

690. Mr. Speaker, in line with our medium-term objectives, the outlook is to:

* improve the standard of living of ordinary Ghanaians by achieving real growth by at least 4.9 per cent.
* reduce inflation from 15.0 per cent at end 2002, to below 10.0 per cent by end 2003 and therefore increase the purchasing power of all Ghanaians.
* increase poverty spending financed in part through debt relief under the HIPC initiative.
build our gross external reserves to 3 months of imports of goods and services as a cushion against short-term external shocks, strengthen the external value of the cedi, and minimize our external debt burden.

691. Mr. Speaker, let me repeat what I said earlier. The outlook for reduction in poverty has never been brighter. The NPP Government believes in sound public investment and our use of HIPC funds clearly demonstrates this belief. Our investments in rural water, sanitation, basic health and basic schooling all play very important roles in building individual capabilities, and in enhancing growth from the village level to the national level. The increase in expenditures on basic social services and income generation activities for the poor and vulnerable of the society by nearly 42.0 per cent is clear testimony to our commitment.

692. Mr. Speaker, Ghanaians can rest assured that perhaps, more clearly than ever before in our history, the NPP Government is determined to use the national budget as the primary instrument to serve the public purpose. The budget will be used as the tool to reach the GPRS objectives. It will be the instrument to show the flexibility of Government to changing needs and the Government’s responsiveness to special needs of the different communities and the different sectors of the economy.

693. Mr. Speaker, the budget statement contains several details of the specific programmes and activities. Here are some examples:

* the development and rehabilitation of major highways and improvements of roads to major markets as well as upgrading feeder roads which have already started in response to the pressing need to open up the country for long-term development, to facilitate trade, and to improve road safety;

* the effort to increase access to safe water and sanitary facilities, especially in the rural areas and in the northern parts of the country is a response to the fact that the high incidence of diarrhoea and guinea worms are largely the result of lack of access to safe drinking water;

* Mr. Speaker, the redistribution of health workers in favour of the deprived areas of the country, the phasing out of the Cash and Carry system, the introduction of the National Health Insurance Scheme and the provision of outreach services in the deprived areas are all intended to bridge equity gaps in access to quality health.

* the rehabilitation and development of 2000 six-unit classrooms blocks at the basic level in deprived areas, the construction of 505 KVIPs for basic schools, the total of 24 rehabilitated and 66 construction projects for Senior Secondary Schools in rural areas, providing material support for needy girls as a strategy to increase girls enrollment and promoting retention of girls and providing desks and chairs for every child are major steps towards achieving our education sector priorities.

* the education of 500 nutritionists in 50 Second Cycle schools, the education of 500 communities in Safe Motherhood practices, the sensitization of 500 communities on gender issues and the rehabilitation of 500 street children are good beginnings to address issues that are unique to women.

* Mr. Speaker, the extension of power to additional 2000 communities in the next three years, and the provision of streetlights in all regional capitals is in response to both rural needs and improvements in public safety and security in urban areas.

* the effort to bring in 250 more high occupancy mass transport buses to add to the fleet in 2003 is a response to the public’s transportation needs.

* the roll out of additional 400,000 telephone lines in the next three years is in response to the need to accelerate the rapid socio-economic development of the country. This will pave the way to make ICT facilities accessible to the rural communities.

694. Besides, the President’s Special Initiative will also be stepped up during the year to increase job creation as a matter of urgency.

695. Mr. Speaker, we are mindful of the challenges arising from the global economic slowdown, from the war clouds looming over Iraq, and from our sub-regional conflicts and instabilities. These are reasons enough to strengthen our domestic economy, including maintaining industrial harmony, a stable fiscal and monetary regime, and spur private sector growth.

696. Mr. Speaker, this is the Budget Statement and Economic Policy for the year 2003. Its basic thrust as the President signalled in his State of the Nation address is to spearhead the drive towards growth, the diversification and deepening of the economy, poverty alleviation, social equity and prudent economic management. The realization of these noble objectives demands the best of us in our actions in both the public and private sectors.

697. Mr. Speaker, the successful implementation of the policies outlined in this year’s budget is crucial to our aspiration to exit from the HIPC status - through reaching the Completion Point.

698. The role of this august House in helping to achieve this objective cannot be underestimated. I have enjoyed the support of this august House in previous years for which I am profoundly grateful. I am very hopeful that I shall continue to receive the same support and quick passage of the Budget Statement and Economic Policy for the year 2003.

699. Amid the risks of an uncertain and often unstable global economy, we are determined to maintain our disciplined approach: determined not to make the old mistakes of paying ourselves too much today, at the cost of higher inflation, interest rates and fewer jobs tomorrow, determined not to make the old mistake of putting consumption before investment, the short term before the long term. We are determined to free the economy for sustained growth. Ghana deserves no less and this Budget puts the country firmly on the path to prosperity.

700. Mr. Speaker, in conclusion, let us remember the charge which our illustrious musician, the late Dr. Ephraim Amu left to Ghanaians.

Y?n ara asase ni. ?y? aboɔden de ma y?n, Mogya na nananom hwiegui nya de too hɔ maa y?n. Adu me ne wo nso so, s? y?b?y? bi atoa so…

701. Let us individually and collectively build Ghana that we shall be proud to leave to our children and generations unborn.

702. With God on our side. We shall succeed.

703. Mr. Speaker, I beg to move.