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FULL TEXT: 2019 Budget presentation by Finance Minister Ken Ofori-Atta

Finance Minister Ken Ofori Atta has admitted that there are hardships in Ghana, noting however, that government is not proud of  it.

The theme for the 2019 budget statement was  “A Stronger Economy for Jobs and Prosperity”.

In his initial commentary while presenting the 2019 budget statement in Parliament Thursday, Mr. Ofori Atta  said the Akufo-Addo government is comforted by the measures being taken to ameliorate the plight of Ghanaians.

He also has revealed that the collapse of seven banks – unibank, Beige Bank, Sovereign Bank, Construction Bank, Royal Bank, Capital Bank, UT Bank – has cost the government an amount of GH¢9.9 billion.

Ken Ofori Atta told Parliament during the presentation of the 2019 budget Thursday that over 90% of customers deposits at DKM has been paid by the state.

The Budget Speech
of the Government of Ghana for the
2019 Financial Y ear

Presented to Parliament on Thursday, 15th November 2018 By

Ken Ofori-Atta Minister for Finance

Theme: “A Stronger Economy for Jobs and Prosperity ”

Section One:

Introduction

1. Right Honourable Speaker, Honourable Members of Parliament, today the fifteenth day of November 2018, on the authority of the President of the Republic of Ghana, His Excellency Nana Addo Dankwa Akufo-Addo, I beg to move that this august House approves the Financial Policy of the Government of the Republic of Ghana for the year ending 31st December, 2019.

2. Mr. Speaker, on the authority of His Excellency the President, and in keeping with the requirement under Article 179 of the 1992 Constitution of the Republic of Ghana, may I respectfully present the Budget Statement and Economic Policies of Government for 2019 to this Honourable House.

3. Mr. Speaker, this statement is an abridged version of the 2019 Budget Statement. I would like to request the Hansard Department to capture the entire Budget Statement and Economic Policy.

4. I also submit before this august House, the 2018 Annual Report on the Petroleum Funds, in accordance with Section 48 of the Petroleum Revenue Management Act, 2011 (Act 815), as amended.

5. Mr. Speaker, the theme of this year’s budget is “A Stronger Economy, for Jobs and Prosperity”. The budget represents the third of four budget statements of the government. It, therefore, offers us an opportunity to take a mid-term review of the performance of the Government in managing the economy and how we intend to accelerate the programme of growing the economy, protecting the vulnerable, and creating jobs and prosperity for the Ghanaian people over the next financial year.

6. I do not take lightly the significance of this moment and opportunity we are granted annually to determine how the precious assets of Ghana – our people, our land, our natural resources and our treasury should be stewarded for national growth and human development.

7. Despite the challenges, we approach this process with genuine humility and gratitude to a great God. We recognize that while current resources are insufficient to meet every need and every demand of every Ghanaian, there are no limitations on our collective potential, our will and our hope that the sacrifices we make and the seeds we sow today will achieve sustainable results putting Ghana on an irreversible path of enviable empowerment.

8. With all the humility I can muster, Mr. Speaker, permit me to say that I am proud to say that the Akufo-Addo government is delivering on this four-year resounding mandate that the people of Ghana has given us. This is evident in the impressive strides the nation has made in the past 22 months.

9. Mr. Speaker, on behalf of the President, I wish to thank you all, the citizens of this country, for your patience, perseverance, sacrifices, activism and partnership that you have extended to this government. So far-reaching and non-partisan has these national sacrifices been, that even now, some members of the Minority in Parliament have decided to lead the campaign for cleaner environment by dumping their gasguzzling Toyota Land cruisers to ride bicycles to work. For example, a former Deputy Minister for Power, during the unforgiving ‘Dumsor’ era under President John Dramani Mahama, was seen two evenings ago riding his bicycle to a luxury furniture shop on the Spintex Road.

10. Yes, Mr. Speaker, we have, in the last two budget years, taken some tough decisions to get the country out of some very rough seas. We are not proud of the fact that there is still hardship in the country. But we are comforted by the fact that  we have managed to ease the impact of the hardships that the Ghanaian people had been resigned to prior to December 7, 2016. We are not there yet. We still have a long way to go in fulfilling the manifest destiny of this blessed land. Indeed, we are being repaid for “the years the locusts have eaten”.

11. So, Mr. Speaker, what is, however, clear is that the nation is moving forward under this government and moving forward in the right direction.

12. We are now on course to exit the IMF programme by the end of this year. It has been a collective effort by all of us–– Government, for exercising the kind of macro-economic competence and discipline that was evidently lacking in the past; and, the people for their patience, understanding, and keeping faith with their government. The programme may have had its critics because of the constraints it imposed. But it was a necessary pill because by 2014, the government then had lost its fiscal discipline and had very little choice but to seek the bailout. We are grateful to the IMF and are determined to maintain a combination of economic discipline and vibrancy that will ensure that we will not have to be rescued in that manner in the future.

13. Mr. Speaker, the philosophy of this government has not been to throw our hands in the air and offer excuses. The President, of course, set the standard in his first State of the Nation address. He said: “I was not elected by the overwhelming majority of the Ghanaian people to complain. I was elected to get things done. I was elected to fix what is broken and my government and I are determined to do just that.”

14. Mr. Speaker, it is important to remember what it was in order to appreciate the work that has been done to fix the mess:

● Declining economic growth that fell from 14 percent 2011 to 3.7 percent in 2016;

● Declining growth in agriculture and negative growth in industry;

● Rising unemployment that resulted in the formation of the Unemployed Graduates Association;

● High Fiscal Deficits reaching 9.3 percent of GDP in 2016;

● Fast rising Public Debts which pushed the debt-to-GDP ratio to 73.1 percent at the end of 2016;

● Fast-falling Cedi, affecting even the meagre profits that street hawkers struggle to make;

● High interest rates killing businesses;

● Effective return to “Cash and Carry” under NHIS as a result of Government arrears

● Weak Banking System and unstable financial system;

● And, lest we forget, Mr. Speaker, Ghanaian businesses, big and small, were working only to pay electricity bills or to buy diesel for the generator. We cannot forget so soon the havoc that five years of ‘Dumsor’ caused to households, businesses and all, up and down the country.

15. These are just some items on the long list of things that were broken and needed to be fixed. 16. Mr. Speaker, within two years of the change in government, below are just some of the problems we have fixed:

● a change in the management of the economy;

● a change from macroeconomic instability to macroeconomic stability;

● a change from a rising debt-to-GDP ratio to a declining debt-to-GDP ratio;

● changing from a weak banking system to a strong, well capitalised and better supervised banking system;

● a change from taxation that undermines production;

● a change from a predominance of sole sourcing to competitive tendering in procurement; this changed has seen the Public Procurement Authority making total savings of GH¢1.8 billion from January 2017 to October 2018. It is important to recognized that not a single pesewa was saved all the years under the previous government until 2017.

● a change from the manual process of clearing goods, with its attendant corruption at the ports to a paperless process;

● a change to bring about a reduction in electricity tariff;

● a change from Dumsor to reliable power;

● a change in the access to and cost of education, to introduce free Senior High School education;

● a change from the abolition of teacher training allowances to a restoration of teacher training allowances;

● a change from Cash and Carry in NHIS to a functioning national health insurance system where arrears have been cleared;

● a change from the abolition of nursing training allowances to a restoration of nursing training allowances;

● a change to increase the share of the DACF to persons with disabilities from 2 percent to 3 percent;

● a change in a moribund private sector to a vibrant job creating private sector;

● a change from rising graduate unemployment to reducing graduate unemployment through programmes such as the 100,000 strong NABCO corps;

● a change from a dying colonial railway network system, that had been to a re-energised railway sector;

● a change from a stagnant agricultural sector to a revitalised agricultural sector under the Planting for Food and Jobs programme;

● a change from destructive galamsey activities to a regulated small-scale mining activities;

● a change from the opaque allocation of Ghana’s oil blocks to non-performing cronies to a transparent allocation of oil blocks to investors with the capacity to work the fields. 17. Mr. Speaker, His Excellency responded and promised:

● an innovative change to bring jobs and income to every district through One District One Factory;

● an innovative change to bring development to our rural areas through One Village One Dam under IPEP;

● an innovative change to Mobile Payment Interoperability;

● an innovative change to three Development Authorities to be a vehicle for accelerated development and the allocation of capital expenditure;

● an innovative change to the establishment of the Zongo Development Fund as a vehicle to focus on the developmental needs of Zongo communities; and

● an innovative change to the approach of entrepreneurship development through the establishment of the National Entrepreneurship and Innovation Programme (NEIP).

18. A major focus of the Government in the last 22 months has been to clean the economic mess we inherited with the restoration and sustainability of macroeconomic stability as the anchor for economic growth. Fiscal policy has been underpinned by increased revenue mobilisation, fiscal consolidation, and expenditure prioritisation, as well as moving Government policy from a focus on taxation to a focus on production. In this regard,Government has implemented the following policies and measures:

● Abolished excise duty on petroleum;

● Reduced special petroleum tax rate from 17.5 percent to 15.0 percent and further reduced to 13 percent, converted from ad valorem to specific tax. In fact, it is important to note that petroleum taxes as a percentage of the total price build up for petroleum prices has reduced from 40.0 percent in March 2017 to 26.0 percent today;

● We abolished levies imposed on ‘kayayei’ by local authorities;

● Abolished the 1 percent Special Import Levy;

● Abolished the 17.5 percent VAT/NHIL on domestic airline tickets;

● Abolished the 17.5 percent VAT/NHIL on financial services;

● Abolished the 17.5 percent VAT/NHIL on selected imported medicines, that are not produced locally;

● Abolished the 5.0 percent VAT/NHIL on Real Estate sales;

● Abolished import duty on the importation of spare parts;

● Reduced National Electrification Scheme Levy from 5.0 percent to 2.0 percent and

● Reduced Public Lighting Levy from 5.0 percent to 3.0 percent. 19. After 22 months of disciplined economic management, the results have been quite remarkable:

● Economic growth increased from 3.7 percent in 2016 to 8.5 percent in 2017;

● Agriculture growth increased from 3.0 percent in 2016 to 8.4 percent in 2017;

● Industry growth rose from negative 0.5 percent in 2016 to 16.7 percent in 2017;

● Services Sector grew at 4.3 percent in 2017 compared to 5.7 percent in 2016;

● The fiscal deficit was reduced from 9.3 percent of GDP in 2016 to 5.9 percent of GDP in 2017 (the first time since 2006 that a government has met the deficit target), it is at 2.8 percent of GDP in June 2018 within the target of 4.5 percent of GDP in December 2018;

● Inflation declined from 15.4 percent in 2016 to 11.8 percent in 2017 and now stands in single digits at 9.8 percent (September);

● The Bank of Ghana Monetary Policy Rate saw a year-on-year reduction from 25.5 percent by end-2016 to 20 percent by end2017 and currently stands at 17 percent. This is the longest 18month reduction in the monetary policy rate since 2001;

● Interest rates on the 91-day treasury bills declined from 16.8 and now stands at 13.4 percent;

● Ghana’s trade position with the rest of the world has strengthened. The trade account recorded a deficit of US$1.4 billion in June 2016, improved significantly to a surplus for the first time in two decades to US$1.1 billion as at June 2017 and another surplus of US$1.1 billion as at June 2018;

● Our gross international reserves increased from $6.2 billion in December 2016 (3.5 months of imports) to US$7.3 billion as at June 2018 (3.9 months of imports);

● Ghana’s debt to GDP ratio which increased from 32 percent in 2008 to 73.1 percent in 2016 declined for the first time since 2007 from 73.1 percent of GDP in 2016 to 67.3 percent in June 2018; and

● For the first time in almost a decade, Standard and Poor’s (S&P) upgraded Ghana’s Sovereign Credit rating from B negative to B with a stable outlook, in September 2018. 20. These are remarkable achievements which we are determined to build on in order to improve the lives of Ghanaians. In preparing this budget, we undertook broad consultations with various stakeholders across the nation. Consequently, I present to this august house and to the people of our great country:

● a budget that delivers on the hopes and expectations of Ghanaians;

● a budget that speaks to the needs of hardworking Ghanaians;

● a budget that enables us to face the future with confidence;

● a budget that reflects Government’s commitment to building human capital through improv e m e n ts in health and education;

● a budget that continues to deliver on job creation;

● a budget that provides opportunity for wealth creation;

● a budget that follows through on our promise to protect the public purse;

● a budget that small businesses will be happy about;

● a budget that enjoins our citizens to uphold the Republic and to at all times fulfil their civic duties as citizens of the Republic;

● a budget that promotes our commitment to the Sustainable Development Goals (SDGs), and takes fundamental steps towards Ghana Beyond Aid.

21. This will be the first budget in Africa and second in the world, after Mexico to fully integrate the SDGs framework, enabling us to track our financial performance in order to ensure progress on these important targets that affect lives of our fellow Ghanaians.

22. Mr. Speaker, our 2018 “Adwuma” Budget aimed to build on our 2017 “Asempa” Budget achievements and put the country back to work; to grow the economy, create jobs and improve the lives of Ghanaians. Economic growth remains strong, and we are on track to achieve our key macroeconomic targets for 2018 and the medium term. This is progress we can all be proud of.

23. Mr. Speaker, the Ghana Statistical Service (GSS) completed the GDP rebasing exercise in September 2018. As a result, our economy is 24.5 percent larger. This increase reflects economic activities that hitherto were not captured (e.g. natural gas production), or were captured with insufficient data (e.g. fruits, vegetables, mining and manufacturing activities).

24. The rebasing resulted in a number of changes in some economic indicators. The good news is that per capita GDP rose from GH¢7,110 to GH¢8,863. On the other hand, with the expanded GDP base, the 2017 GDP growth rate of 8.5 percent was revised down to 8.1 percent, which is still the highest in recent years. We are fully aware of what happened the last time Ghana’s economy was rebased, in November 2010, resulting in a 63 percent upward change. It gave the then managers of the economy a false sense of security, as the debt-to-GDP ratio was significantly reduced. They went on a borrowing spree, forgetting that rebasing also exposed how very little revenue we raise through taxation.

25. Mr. Speaker, during the first half of 2018, real GDP grew by 5.4 percent, reflecting slower growth in the oil sector compared to 2017, but we are still on track to achieve our revised target of 5.6 percent growth this year. Much of the higher growth in the past 2 years reflects our prudent economic management and flagship programmes that respond to the realities of the majority of our citizens

26. In addition to significant achievements in stabilising the economy, we are on course to achieve our fiscal deficit target of 4.5 percent for the year (3.7 % in the rebased series). This will be the 2nd consecutive year this Government has achieved its fiscal deficit target.

27. Mr. Speaker not only are we growing the economy, the Bank of Ghana has also done an excellent job in implementing monetary policy. This has resulted in inflation dropping to single digit, lower interest rates, and a relatively stable currency, despite recent turbulence in emerging markets, and a strengthening US Dollar.

28. The financial system is critical to the functioning and development of the economy and, banks are central to our financial system. In addition to providing employment to a large segment of the population, the role of banks as the provider of credit and liquidity to the economy remains critical to the functioning of our economy.

29. Mr. Speaker, weak macroeconomic conditions coupled with poor corporate governance and risk management in a number of banks, over the past few years, led to high levels of nonperforming loans (NPLs) and abuse of depositors’ funds through related parties and affiliates in breach of regulatory requirements. In addition, the lack of enforcement of the rules contributed to liquidity and solvency challenges in the banking sector. As a result, we inherited a number of weak banks and specialised deposit-taking institutions (savings and loans companies, Finance Houses, Rural and Community Banks, and microfinance institutions). This eventually led to the failure of seven banks, with potentially adverse consequences for depositors, creditors, employees, suppliers, and other stakeholders. It was critically important that these failed banks be made to exit the financial system in a timely and orderly fashion to avoid contagion for the rest of the financial system.

30. Mr. Speaker, since the assumption of office by the current administration of the Bank of Ghana, bold measures have been taken to restore the health and resilience of the banking sector and to clamp down on unlicensed deposit-taking financial houses. In addition to the two insolvent banks that were closed last year by the Bank of Ghana, five more were closed in August this year for insolvency and other infractions of the law. Rescuing the situation regarding these seven banks has, so far, cost some GH¢9.9 billion in monies that Government had not budgeted for and could have surely been put in good use to fix our numerous infrastructural needs, such as housing, roads, bridges, etc.

31. The Government has continued to provide assurances to depositors and customers of licensed banks and specialised deposit-taking institutions, through demonstrable actions, that their deposits are safe. Indeed, following the creation of the Consolidated Bank Ghana Limited (a wholly owned Government of Ghana and licensed by the Bank of Ghana as a universal bank), the government capitalised it with GH¢450 million. In addition, Government had to issue a bond with a face value of GH¢7.6 billion to cover the gap, between the deposit liabilities and the remaining good assets of the failed banks. This singular action of government has reposed confidence in the banking system because it will ensure that no deposit will be lost, and customers will continue to access their deposits without difficulty.

32. Through Government’s intervention in August this year, deposits of some GH¢11.0 billion have been saved as well as some 2,661 jobs in addition to several hundred saved in 2017 from the insolvent 2 banks that were closed in 2017. The Government’s action has also created a strong indigenous Ghanaian bank in place of the five failed banks. The Government is committed to ensuring that Consolidated Bank Ghana Limited remains a strong customer-oriented indigenous bank, well positioned to meet the demands of all its customers and to serve as the go-to bank for financing Small and Medium Sized Enterprises (SMEs) and corporate Ghana.

33. Mr. Speaker, generally, banks have made progress in repairing their balance sheets by writing off bad loans and addressing capital needs. Banks are far advanced in executing their plans to augment their statutory capital in line with the new minimum requirement, compliance of which is expected by end-December 2018.

34. The Bank of Ghana is also working on a comprehensive action plan for cleaning up the specialised deposit-taking institutions (SDI) sector made up of savings and loans companies, finance houses, rural and community banks, and microfinance institutions. The Government will support an orderly resolution of the difficulties and will provide the much-needed funds to facilitate prompt pay-outs to their depositors.

35. Mr. Speaker, the Government’s financial interventions in the clean-up exercise have been necessary to help mitigate the socio-economic impacts arising out of the closure of the failed financial institutions. It is important that the costs of these interventions, borne by taxpayers, are recovered to the extent possible, through recoveries from debtors, shareholders, and related and connected parties, who, through unfair means, siphoned funds, from the defunct banks to the detriment of depositors, employees, other stakeholders, and the economy as a whole. The receivers for the resolved banks have already commenced civil actions against shareholders and directors to recover funds. The Attorney-General has also set up a special investigation team that is preparing dockets to prosecute those found criminally liable. The Bank of Ghana has also set up an Office of Ethics and Internal Investigations to investigate all allegations of misconduct by staff, including any role in the
collapse of defunct banks. The Government will not shield anyone found complicit in the failure of these banks.

36. In addition to all these clean-ups, Government has also taken steps to settle almost all claims of DKM customers. Mr. Speaker, you would recall that DKM Diamond Microfinance Limited had its license revoked in February 2016 with considerable suffering imposed on depositors, without any meaningful response from the previous government. That has significantly changed. The official liquidator received 99,858 claims and the validated claims amounted to GH¢502 million. I would like to inform the country that out of the 99,858 claims, 79,708 (80 percent) have been settled and depositors have been paid. The Government has set aside funds at the Bank of Ghana to pay the remaining 20 percent of depositors upon validation. An additional 12,612 claims have been fully provided for, but the customers have not as yet been able to show proof of deposit. This means that 92 percent of DKM claims from depositors have been paid or provided for. Depositors for the remaining 7,568 claims of above GH¢10,000 are yet to reach agreement with the liquidators.

37. Mr. Speaker let me say how pleased His Excellency the President is, that in 2018, 270,000 young Ghanaians (90,000 in 2017/2018 and 180,000 in 2018/2019) who would not have been able to access secondary education were able to attend to do so because of Free SHS. We cannot downplay how significant this is to build a future for every citizen of this land.

38. Mr. Speaker, the days of an ailing National Health Insurance Scheme are behind us. We have re-energised the scheme which is now able to settle its bills, thereby ensuring that many more Ghanaians have access to quality healthcare across the country. 39. For our Government, support for the private sector is a top priority. Our efforts to improve the business environment were duly recognised in the 2019 World Bank Ease of Doing Business Report, in which our position improved from 120th to 114th, out of 190 countries. This is just the beginning, as we strive to continually improve the business climate in Ghana. We can and will do much better.

40. Government has provided strong support to stimulate the private sector. In addition to bringing down interest rates, we provided direct support to the sector, through the Stimulus and 1D1F programmes. The 1D1F programme has generated strong interest from several banks. Fifty-five (55) companies have been funded, with several others in the pipeline.

41. Mr. Speaker, Government’s Planting for Food and Jobs programme (PFJ) is yielding impressive results. In order to consolidate the gains achieved under programme, Government, last week, operationalised the Ghana Commodity Exchange, the first electronic commodity exchange in West Africa. Going forward, there will always be a ready market for farmers who produce grains such as corn and soya, among others.

42. Through this exchange an estimated 200,000 skilled jobs will be provided not only in Accra but in key agriculture production and trading centres including Wenchi, Tamale and Sandema which host warehouses to support the exchange. Some of the jobs to be created include commodity brokers, data analysts, credit officers and grain pickers.

43. Mr. Speaker, Ghana’s credibility in the international capital market is on the rise. As a testament to the prudent fiscal and monetary policies of this Government, in May 2018, The AkufoAddo Government successfully issued its first Eurobond, with shining success: a hat trick of 3 Ls:
• Largest Eu robond issuance of $2 billion;

• the Longest maturity period of 30 years; and

• the Lowest pricing in Ghana’s history — 8.627 percent for the 30 – year bond!

44. Mr. Speaker, 2018 Ghana’s appeal as the preferred investment destination has grown significantly and we have attracted global industry giants such as Volkswagen, Nissan, ExxonMobil and Siemens to establish local assembly plants.

45. Mr. Speaker, our policies have improved the business environment and the private sector has responded by increasing jobs. Based on SSNIT data, the private sector added 208,620 formal jobs in the first 10 months of 2018, an increase on the 197,000 formal jobs registered in 2017. We have resourced the Ghana Statistical Service and the Ministry of Employment and Labour Relations to develop a more robust system to track employment on a quarterly basis.

46. Government is also doing its part on job creation. Over the period 2017 and 2018, the Ministry of Finance granted financial clearance to various agencies to recruit 88,719 Ghanaians into critical sectors of agriculture, health, and education to enable us to improve service delivery. In addition, the Nation Builders Corps (NABCO), a three – year transitional job opportunity for young graduates has enrolled 100,000 young graduates to support the delivery of critical public services.

47. Mr. Speaker, this is a monumental achievement as it is the largest single jobs and skills development programme in the last 50 years. The testimonies from the beneficiaries and their families have reaffirmed Government’s commitment to transform our society.

48. Mr. Speaker, in recent times, the NPP Government has had to inherit an IMF programme from our friends across the aisle which we have successfully completed. Notwithstanding exiting this current programme after successful completion, we will continue with our prudent management of the economy and buttress that with legal and institutional measures to ensure irreversibility of the gains made so far. However, as a member in good standing, we will continue our productive policy and technical collaborations with the IMF.

49. Mr. Speaker, Ghana can look forward with renewed confidence. This seminal 2019 budget, which comes at the mid-term of our administration aims to consolidate the gains from tough reform measures taken so far and surge boldly forward in growing our economy especially as we successfully exit the ECF programme with the IMF, our trusted advisors in the past three years. Under the ECF programme, we jointly made some difficult decisions, which have enabled us to improve our macroeconomic situation.

50. Mr. Speaker, we would like to acknowledge the role and contributions of the IMF in our achievements in macroeconomic stabilisation and growth. As a member of the IMF, Ghana will continue to engage the IMF through Article IV consultations and other arrangements even after its exit from the current ECF Programme. 51. As we complete and exit the programme in December 2018, we are also instituting measures to ensure irreversibility of the macroeconomic gains we have made.

Consequently, we will, among others:

● legislate a fiscal responsibility rule to cap the fiscal deficit to no more than 5% of GDP as part of measures to promote budget credibility and fiscal sustainability;

● strictly enforce the PFM Act to promote efficient and effective public financial management;

● continue with the zero central bank financing arrangement with the BoG to curb fiscal dominance as part of measures to rein in on inflation;

● maximize domestic resource mobilization and increase Tax Revenue-to-GDP ratio to levels in line with our peer Lower Middle-Income countries;

● implement expenditure efficiency and rationalisation measures to increase efficiency in public spending and free more fiscal space for growth oriented and job-creating programmes;

● enforce the Public Procurement Act and ensure sole sourcing is minimized to promote competition and efficiency in public spending, thereby, promoting value for money; and

● institute risk management framework to mitigate macrofiscal risks. In view of this a Fiscal Risks Unit has been established at the Ministry of Finance.

52. God has demonstrated countless times that He can use ordinary people, ordinary nations in ordinary times to do extraordinarythings. Ghana has a history replete with “extraordinary” achievements – nationally, regionally and internationally. These achievements were the result and culmination of right choices.

53. Mr. Speaker, having set the tone for this budget, in accordance with the Public Financial Management Act, I will proceed to provide details of Government’s plans for 2019, focusing on:

● Recent global macroeconomic developments, and their implications for Ghana;

● Ghana’s macroeconomic performance in 2018, and our targets for 2019 and the medium term; and

● Sectoral performance, Government’s key programmes and policy initiatives, and the consequent deliverables.

Section Two: Global Economic Developments and Outlook Growth

54. Mr. Speaker, according to the IMF’s October 2018 World Economic Outlook (WEO), global growth momentum moderated in the first half of 2018, compared to the same period in 2017. This reflected greater than expected moderation of activity in some advanced economies, particularly, in the euro area and United Kingdom. Global growth is projected to be maintained at 3.7 percent in 2018 and 2019, same as in 2017.

55. Growth in advanced economies expected to increase very marginally from 2.3 percent in 2017 to 2.4 percent in 2018, largely on the back of strong growth in the US economy, which benefited from sizable fiscal stimulus. Growth in emerging markets and developing economies was steady in the first half of 2018, supported by continued stronger growth in emerging Asia, despite the moderation of activity in China. Growth in the
emerging markets and developing economies is projected to remain steady at 4.7 percent in 2019, same as in 2018 and 2017. In sub-Saharan Africa, growth is expected to increase from 2.7 percent in 2017 to 3.1 percent in 2018, and further to 3.8 percent in 2019, boosted by oil-exporting economies which benefited from higher oil prices.

Inflation

56. Mr. Speaker, global inflation increased in the second quarter of 2018, largely reflecting higher energy prices. Core inflation, excluding food and energy, remains below target in most advanced economies while in emerging markets and developing economies, core inflation has inched up in recent months.

Commodity Prices

57. Mr. Speaker, commodity prices generally continued to strengthen in the third quarter of 2018; oil prices increased to about US$76 a barrel in the first half of 2018, the highest since November 2014, but declined to about US$71 in October 2018, following increased oil production by the major exporters.

58. Mr. Speaker, the world market price of cocoa beans is estimated to reach US$2,200 per metric tonne in 2018 compared to US$2,025 in 2017. Gold prices are also projected to increase from US$1,293/toz in 2017 to an average of US$1,3460/toz in 2018 before falling slightly to US$1,302/toz in 2019.

Financial conditions

59. Mr. Speaker, the monetary policy normalisation in the US led to a stronger US dollar and rising yields on US treasuries, resulting in tighter financing conditions and capital flow reversals in a number of emerging markets and frontier economies, including Ghana. Despite these developments, global financial conditions remain generally supportive of growth.

SECTION 3: DOMESTIC MACROECONOMIC PERFORMANCE FOR 2018

60. Mr. Speaker, the performance of the economy for the first nine months has been impressive. To properly assess this performance, let me first re-state the macroeconomic targets set for 2018 as presented in the 2018 Budget:

● Overall Real GDP growth rate of 6.8 percent (5.6 % in the rebased series);

● Non-Oil Real GDP growth rate of 5.4 percent (5.8 % in the rebased series);

● End-period inflation of 8.9 percent;

● Fiscal deficit of 4.5 percent of GDP (3.7 % in the rebased series);

● Primary surplus of 1.7 percent of GDP (1.4 % in the rebased series); and
● Gross International Reserves to cover not less than 3.5 months of imports of goods and services.

61. Mr. Speaker, data as at the end September 2018 shows that, the economy is in good shape and we are on track to meet our targets:

● Real GDP grew by 5.4 percent (using rebased series) in the first half of 2018 compared to the annual target of 5.6 percent. Nonoil real GDP grew by 4.6 percent compared to the 2018 target of 5.8 percent;

● End-period inflation rate declined from 11.8 percent at the end of 2017 to 9.8 percent at the end of September 2018; and further to 9.5 percent as at October 2018;

● The fiscal deficit was 3.0 percent of rebased GDP at the end of September 2018 compared to a target of 2.7 percent;

● The primary balance was a surplus of 0.5 percent of rebased GDP compared to a target of 0.9 percent of rebased GDP for the period;

● The public debt including the financial sector bailout costs at the end of September 2018 was 57.4 percent of rebased GDP. Excluding bailout costs, the debt was 53.9 percent of rebased GDP;

● The monetary policy rate dropped from 20 percent at the end of 2017 to 17 percent at the end of October 2018;

● The provisional trade balance for the period recorded a surplus of US$1,617.81 million compared to a surplus of US$777.82 million recorded for the same period in 2017; ● Gross International Reserves accumulated to US$6,756.43 million sufficient to cover up to 3.6 months of imports, ahead of our 2018 target of 3.5 months;

● The exchange rate, which appreciated against the US Dollar up to May 2018, depreciated by 7.57 percent at the end of Sept 2018 largely on account of external pressures including the strengthening of the US dollar, the US-China trade war, and the US Fed policy rate hikes. Compared to other emerging economies, Ghana has been able to weather the storm a lot better, primarily due to strong economic fundamentals.

62. Mr. Speaker, the detailed performance in the real, monetary, external, and fiscal sectors of the economy is provided below.
Growth

63. Mr. Speaker, the 2018 Budget envisaged a 6.8 percent GDP growth rate. However, with the rebasing of the GDP, there has been the need to revise the 2018 growth projection. Thus, the overall GDP growth target has been revised to 5.6 percent, taking account of the base effect of the GDP rebasing and half year performance. Non-Oil GDP is projected to grow by 5.8 percent.

64. Mr. Speaker, provisional estimates by the Ghana Statistical Service show that economic growth remains strong in 2018. Real GDP grew by 5.4 percent during the first half of 2018. The non-oil economy grew by 4.4 percent and 4.3 percent in the first and second quarters of 2018, respectively.
Monetary Aggregates and Credit Developments

65. Mr. Speaker, broad money supply, including foreign currency deposits (M2+) grew by 24.1 percent year-on-year at end September 2018 compared with 23.1 percent over the same period in 2017. The pace of expansion in banks’ total outstanding credit increased in the 12-month period to September 2018. Total outstanding credit increased by 13.0 percent (GH¢4.7 billion) compared with 7.9 percent (GH¢2.6 billion) in September 2017. Most of the credit to the private sector was absorbed by the commerce and finance, services, transport and storage, communication, and manufacturing subsectors.

Interest Rates

66. Mr. Speaker, money market interest rates generally trended downwards in 2018, reflecting the reduction in the monetary policy rate and general improvements in macroeconomic fundamentals. However, the 91-day Treasury bill rate increased to 13.37 percent in September 2018, from 12.8 percent a year ago, while the 1-year note firmed up to 18.0 percent in September 2018. Deposits and lending rates of the Deposit Money Banks also went down generally.

Exchange Rate

67. Mr. Speaker, the Ghanaian Cedi, came under pressure in the second quarter of 2018, following the strengthening of the US dollar in international markets. These developments resulted in tighter financing conditions and capital flow reversals in a number of emerging markets and frontier economies, including Ghana. Domestic demand pressures for foreign exchange, as well as, speculative trading were also contributory factors. Mr. Speaker, the Cedi, however, stabilised in the third quarter, benefiting from positive sentiments on the market as a result of the cocoa syndicated loan inflow.

International Reserves

68. Mr. Speaker, these external sector developments resulted in a drawdown of the country’s gross international reserves by US$798.41 million to US$6.8 billion at the end of September 2018. This was sufficient to provide for 3.6 months of imports cover compared with 3.9 months of imports cover as at December 2017.

Fiscal developments

69. Mr. Speaker, our overarching fiscal policy objective over the past two years has been to consolidate our public finances as a surer path to a declining debt burden. With this in mind, the 2018 Budget set the overall fiscal balance as the primary anchor and targeted a reduction in the fiscal deficit from 4.8 percent of rebased GDP (5.9 % of old GDP) in 2017 to 3.7 percent of rebased GDP (4.5 % of old GDP) in 2018. At the same time, the fiscal framework was calibrated to yield a larger primary surplus relative to the 2017 outturn and ultimately lower the rate of debt accumulation.

70. Mr. Speaker, to safeguard our fiscal policy objectives for 2018, Government presented a package of revenue measures to this august House during the Mid-Year Fiscal Policy Review of the 2018 Budget Statement and Economic Policy. These measures took into consideration, the need; first, to improve the sluggish revenue performance of the first five months of the year and, second, to address the low non-oil tax-to-GDP ratio as compared to peer middle income economies.

71. Specifically, a) GETFund and NHIL were decoupled from the Input-Output VAT mechanism and converted into straight levies with rates remaining at 2.5 percent each; b) a Luxury Vehicle Levy; and c) an additional Personal Income Tax band of income in excess of GH¢10,000 with 35 percent tax rate.

72. Mr. Speaker, provisional data on Government’s fiscal operations from January to September 2018, indicates that, domestic revenues grew by 15.9 percent on an annual basis and reached GH¢31.7 billion compared to GH¢27.3 billion during the same period in 2017. However Total Revenue and Grants was 9.5 percent below target. On the other hand, expenditures were generally lower than programmed although some overruns were observed on specific expenditure lines including Use of Goods and Services and Wages and Salaries. These operations resulted in a fiscal deficit of 3.0 percent of rebased GDP compared to a deficit target of 2.6 percent of rebased GDP for the 9 months.

73. Mr. Speaker, the fiscal deficit was financed from both domestic and external sources and included a drawdown in government deposits with the Bank of Ghana. Total Domestic Financing amounted to GH¢4.2 billion of which net financing from domestic market operations amounted to GH¢6.5 billion. Total Net Foreign Financing amounted to GH¢4.9 billion and included inflows from the issuance of the 2018 Eurobond.

74. Mr. Speaker, the primary balance recorded a surplus of GH¢1.5 billion, 0.5 percent of rebased GDP, albeit lower than the target of GH¢2.8 billion, 0.9 percent of rebased GDP.

Petroleum Receipts

75. Mr. Speaker, Government receipts from crude oil liftings for the first 9 months of 2018, from Jubilee, TEN and Sankofa Gye Nyame (SGN) fields, amounted to US$604.09 million (GH₵2.72 billion). 76. Mr. Speaker, out of petroleum receipts (i.e. proceeds from Liftings and other petroleum receipts) of US$723.55 million, GNPC (the NOC) was allocated a total of US$223.43 million, comprising Equity Financing Cost (US$149.72 million) and its share of the net Carried and Participating Interest (US$73.71 million). The ABFA received a total of US$176.33 million, while the GPFs received US$323.79 million

Public Debt Development

77. Mr. Speaker, the nominal public debt stock as at end September 2018 was GH¢170.8 billion, comprising external and domestic debt of GH¢86.6 billion and GH¢84.1 billion, respectively. The overall rate of debt accumulation in 2018 is 19.8 percent, driven primarily by the cost of the clean-up of the financial sector, involving resolution of the seven (7) defunct banks. The rate of debt accumulation would have been 11.5 percent without the clean-up exercise.

78. Mr. Speaker, public debt (including financial sector bailout) as a percentage of GDP stood at 70.7 percent at the end of September 2018 compared with 69.2 percent during the same period in 2017. The public debt stock (excluding the financial sector clean-up cost) as a ratio of GDP is 66.5 percent. In terms of the rebased GDP, the public debt to GDP ratio is 57.2 percent (including financial sector clean-up cost) and 53.9 percent (excluding clean-up cost).

79. Mr. Speaker, in 2018 we continued the clean-up of a heavily indebted energy sector. Following the establishment of the ESLA bond programme in 2017, Government has steadily settled over GH¢5 billion in legacy debts and aged payables towards the goal of a financially viable and competitive power sector. An audit exercise is currently underway to validate the aged payables that were not considered under the ESLA bond. Once confirmed, government will intervene with a combination of cash and bonds to pay off the valid debts. This measure will improve the liquidity position of the energy sector SOEs and ensure long-term financial viability.

Energy Sector Levies

80. Mr. Speaker, a total amount of GH¢3.5 billion was programmed to be collected in energy sector levies in 2018. At the end of September 2018, an amount of GH¢2.3 billion was collected and lodged into the established, and other, ESLA accounts.

Energy Sector Bonds

81. Mr. Speaker, from January to August 2018, a re-tap on the 10year ESLA bonds was effected with GH¢615.0 million and GH¢264.0 million respectively, bringing the total value of ESLA bonds issued to GHC5.8 billion. Energy-sector SOE debts, amounting to approximately GH¢5.6 billion have been settled to date from the proceeds. Petroleum Risk Management

82. Mr. Speaker, the 2018 Budget announced the development of a petroleum risk management programme to mitigate the economic impacts of global crude price volatility. In the last year, a strong recovery in global crude prices has brought to bear the full brunt of Government’s 2015 price deregulation policy. The Ministry of Finance, Ministry of Energy, and the NPA have worked closely over the past months to develop a strategy to reduce volatility in pump prices by limiting consumers’ expenditure against upward price movements.
Partial Securitisation of Mineral Royalties

83. Mr. Speaker, the 2018 Budget announced Government policy of securitising future mineral royalties to support current developmental needs. In September, Parliament passed the Minerals Income Investment Fund Bill into law. The objective is to hold and manage the equity interests of Government in mining companies and receive mineral royalties and rents due Government. Accordingly, the Fund will set up a SPV to raise funds by way of an Initial Public Offering (“IPO”) through a dual listing on the Ghana and London Stock Exchanges. Government expects to raise up to US$750.0 million from the IPO. The transaction advisors for the IPO have begun work in earnest.

2019 AND MEDIUM-TERM MACROECONOMIC TARGETS

84. Mr. Speaker, I turn now to the medium-term macroeconomic targets.

85. Following our significant achievements in stabilising the economy, Government will continue to pursue prudent macroeconomic policies to provide a stable environment for expanding economic opportunities, and for promoting inclusive and job-creating growth and development.

86. Mr. Speaker, consistent with the Public Financial Management Act, 2016 (Act 921), we will pursue our growth objectives without compromising fiscal consolidation. We will reduce the fiscal deficit to make the overall debt burden sustainable. We will pursue prudent monetary and external sector policies to keep inflation under control and achieve favourable current account balance to underpin exchange rate stability.

87. Mr. Speaker, we have set the following medium term (20192022) macroeconomic targets consistent with our objectives:

● Overall Real GDP to grow at an average of 7.0 percent;

● Non-Oil Real GDP to grow at an average of 6.6 percent;

● Inflation to be within the target band of 8±2 percent;

● Overall fiscal deficit to remain within the fiscal rule of 3-5 percent of GDP;

● The primary balance to be in a surplus of at least 1 percent of GDP; and

● Gross International Reserves to cover at least 4 months of imports of goods and services. 88. Mr. Speaker, based on the overall macroeconomic objective of sustaining and restoring macroeconomic stability and pursuing inclusive growth, and job-creating programmes, the following targets have been set for the 2019 fiscal year:

● Overall Real GDP growth of 7.6 percent;

● Non-Oil Real GDP growth of 6.2 percent;

● End-period inflation of 8.0 percent;

● Fiscal deficit of 4.2 percent of GDP;

● Primary surplus of 1.2 percent of GDP; and

● Gross International Reserves to cover not less than 3.5 months of imports. 89. Mr. Speaker, we now provide details of the medium-term outlook for the real, fiscal, monetary, and external sectors of the economy

Real Sector

90. Mr. Speaker, overall GDP is projected to grow by 7.6 percent in 2019 while non-oil GDP is projected to grow at 6.2 percent. In terms of sectoral growth, the Agriculture Sector is expected to grow by 7.3 percent, the Industry Sector (9.7 %), and the Services Sector (6.1 %).

Fiscal Sector

91. Mr. Speaker, to bolster our resolve to maintain fiscal discipline, Government will soon submit a bill to this august House with the main objective of ensuring that the fiscal deficit is capped at 5 percent of GDP. Additionally, Government will institute a Fiscal Council to further strengthen fiscal management.
Resource Mobilisation for 2019

92. Mr. Speaker, total revenue and grants for 2019 is estimated at GH¢58.9 billion, 17.1 percent of the rebased GDP, up from a projected outturn of GH¢46.8 billion, 15.7 percent of rebased GDP in 2018.

93. Domestic revenue is estimated at GH¢57.8 billion, representing an annual growth of 25.5 percent over the projected outturn for 2018. Of this amount, non-oil Tax Revenue will constitute about 74.2 percent of domestic revenue and amount to GH¢42.9 billion. This estimate reflects the impact of expected improvements in tax compliance and reforms in revenue administration.

94. Non-Tax Revenue, excluding oil, will amount to GH¢6.5 billion (1.9 percent of GDP) in 2019, equivalent to 11.3 percent of Total Domestic Revenue. Of this amount, GH¢4.4 billion is expected to be retained by institutions as internally generated funds (IGF). In addition, as a result of the IGF capping, an amount of GH¢282.2 million is expected to be paid into the Consolidated Fund.

95. Receipts from upstream petroleum activities are projected at GH¢5.4 billion in 2019, equivalent to 1.6 percent of GDP, and representing 30.3 percent growth over the projected outturn for 2018.

96. Grants disbursements from Development Partners are estimated at GH¢1.1 billion, up from the projected outturn of GH¢773.2 million in 2018.

Resource Allocation for 2019

97. Mr. Speaker, Total Expenditure (including clearance of Arrears) is estimated at GH¢73.4 billion, equivalent to 21.3 percent of GDP, representing a growth of 27.0 percent above the projected outturn for 2018.

98. Expenditure on Wages and Salaries is forecasted at GH¢19.4 billion representing about 26.5 percent of Total Expenditure.

The wage bill is anticipated to reduce to 5.6 percent of GDP from the 5.9 percent projected outturn for 2018.

99. Expenditure on Goods and Services is projected at GH¢6.3 billion, representing 1.8 percent of GDP. The annual growth of 38.8 percent reflects a full provision made to cater for the Government’s priority programmes, including the flagship Free SHS policy.

100. A total amount of GH¢18.6 billion has been estimated for Interest Payments of public debt. Of this amount, domestic interest payments will constitute about 77.8 percent and amount to GH¢14.5 billion.

101. Government in 2019 will continue to implement the Earmarked Funds Capping and Realignment Act, 2017 (Act 947) to reduce budget rigidities and create fiscal space to fund growth enhancing expenditures. In this regard, transfers to Statutory Funds as well as all other earmarked funds, are estimated at GH¢13.8 billion, equivalent to 4.0 percent of GDP, compared to 3.5 percent in 2018.

102. Capital Expenditure is projected at GH¢8.5 billion, equivalent to 2.5 percent of GDP and a growth of 55.7 percent over the 2018 projected outturn. Of this amount, domestically financed Capital Expenditure is estimated at GH¢3.2 billion or 0.9 percent of GDP. An amount of GH¢5.3 billion has been budgeted for Foreign Financed Capital Expenditure and this will be funded by a combination of Project Grants and Loans.

Budget Balances and Financing Operations for 2019

103. Mr. Speaker, based on the estimates for Total Revenue & Grants and Total Expenditure, the 2019 fiscal operations will result in an overall budget deficit of GH¢14.5 billion, equivalent to 4.2 percent of GDP. 104. Financing of the fiscal deficit will be from both domestic and foreign sources. Net Foreign Financing will amount to GH¢9.7 billion, including a planned sovereign bond issuance of GH¢9.6 billion. Total Domestic Financing is estimated at GH¢4.8 billion. This will result in a Primary Surplus of 1.2 percent of GDP.
Petroleum Revenue for 2019

105. Mr. Speaker, the Benchmark crude oil price for 2019 has been projected at US$66.76 per barrel in line with the Petroleum Revenue Management Act (Amendment), 2015 (PRMA, Act 893). The gas price for 2019 is also projected at US$3.99 per MMBtu. The 2019 Benchmark Revenue crude oil output is 63.4 million barrels (173,764 barrels of oil per day).

106. Mr. Speaker, the Ministry is proposing to this august House to allow it to exclude gas revenues to the tune of US$181.80 million from the projected petroleum revenues for 2019, as we devise ways of getting VRA to pay for the gas supplied it by Ghana Gas. Furthermore, as a measure to minimise the amount of gas produced in the SGN Field for power production, Government has decided to postpone the extraction of its share of the gas resource (Royalties, and Carried and Participating Interest (CAPI), until such a time that we line up off takers to consume the gas in-year. These are prudential measures and should not be misconstrued to mean that the Ministry will not be pursuing the VRA’s gas bills, as required by the PRMA.

107. Mr. Speaker, if this House grants us this request, the projected petroleum revenue for 2019 will amount to US$1.1 billion.

This is made up of Royalties (US$227.10 million), Carried and Participating Interest (US$602.80 million), Corporate Income Tax (US$249.60 million) and Surface Rentals (US$1.10 million).

108. Of this amount, US$404.90 million will be ceded to the NOC for its Equity Financing Cost (US$320.10 million) and share of the Net Carried and Participating Interest (US$84.80 million), US$473.0 million allocated to the Annual Budget Funding Amount (ABFA), while the GPFs receive US$202.70 million. The GPFs’ receipts will be distributed between the Ghana Stabilisation Fund (US$141.90 million) and the Ghana Heritage Fund (US$60.80 million)
Strategic Pillars of the 2019 Budget

109. Mr. Speaker, consistent with H.E. the President’s vision of transforming the Ghanaian economy, creating prosperity and job opportunities for all, and moving us to a Ghana Beyond Aid, in 2017 and 2018 we launched a number of flagship programs that have yielded significant results. In 2019, Government will consolidate and build on these programs. Mr. Speaker rather than the traditional presentation of Sector al Performance and Outlook , the rest of my presentation is organised so as to highlight the key pillars of our 2019 budget, which takes bold and fundamental steps towards the President’s vision. 110. Mr. Speaker, The Budget Statement and Economic Policy for the 2019 Financial Year provides a detailed account of sectoral performance in 2018 and outlook for 2019. Here, I focus on 6 strategic pillars that build on the flagship programmes and our achievements over the past two years. Mr. Speaker, the strategic pillars of the 2019 budget are:

● Infrastructure;

● Agricultural Modernisation;

● Industrialisation;

● Entrepreneurship;

● Improving Efficiency in Revenue Mobilisation and Protecting the Public Purse.

● Social Intervention

INFRASTRUCTURE

111. Mr. Speaker, infrastructure, both hard and soft, is the backbone of economic development and growth, as well as a source of jobs and wealth for a majority of people. In a rapidly changing global marketplace, traditional infrastructure like electricity and power, transport and logistics, water and sanitation, roads, highways, and railways have combined with new, mostly soft infrastructure like digitisation of government services to enable emerging economies like ours leapfrog the development path to prosperity.

112. Mr. Speaker, this Government, is committed to embarking on an integrated infrastructural development programme across the country that will move goods, food items and people from one location to another that will create jobs and prosperity and ensure value for money for Ghana as well as position Ghana as the transportation, energy and logistics hub in the region.

113. Mr. Speaker, to ensure efficient management of infrastructure, we will soon submit a bill to set up the Ghana Asset Management Corporation. Mr. Speaker, with your permission I will like to inform Ghanaians on what we have done so far on infrastructure and the massive investments commencing in 2019. 114. Mr. Speaker, in 2019, we will invest massively in the development of road and infrastructure, from a variety funding sources and the following projects have been identified to commence in 2019:

Region Project

Ashanti

Ahiankwanta-Obuasi
Ashanti Datano-Ahokwaa-Suhenso
Ashanti (Bauxite Road) Nyinahene – Awisesu
Ashanti (Bauxite Road) Nyinahene – Kyekyewere
Ashanti Okomfo Anokye – Abuakwa
Ashanti Suame Interchange
Ashanti Oforikrom Interchange

Kumasi Inner City Roads

Ashanti
Manhyia Sub-Metro
Suame Sub-Metro
Tafo Pankrono Sub-Metro
Asokwa Sub-Metro
Kwadaso Sub-Metro
Oforikrom Sub-Metro
Subin Sub-Metro
Nhyiaeso Sub-Metro
Bantama Sub-Metro
Mampong Inner City Roads
Brong Ahafo
Atebubu – Kwamedanso – Kojokrom – Riverside
Brong Ahafo Sunyani Inner Ring Road

Brong Ahafo Sunyani Inner City Roads
Brong Ahafo Tepa Bomaa – Yamfo
Brong Ahafo Berekum Inner City Roads
Brong Ahafo Duayaw – Nkwanta
Brong Ahafo Odumasi – Seikwa Nkwanta
Brong Ahafo Bediako – Kasapi – Camp 15

Eastern Kwabeng – Abomosu – Asuom
Eastern Kwabeng – Akropong
Eastern New Abirem-Ofoase-Akim Oda
Akyem – Ankaase town Roads

Akyem Fremponso
Mampong – Kofiase
Anwiankwanta – Obuasi
Eastern Kessekrom-Adiembra
Eastern Koforidua Interchange
Eastern Akroso – Asamankese
Western Prestea Inner City Roads
Western Benchema – Adwofia
Western Asankragua – Agona – Sefwi Bekwai
Central Awakrom-Amisano(Ekumfi)

Central
Twifo Praso -Esikuma- Dunkwa on Offin

Central
Akotokyir Road
Amamoma Area Roads
Western Abura New Community Area
Cape Coast Polytechnic Road
Western Apawusika Road and Links
Central Agona Swedru Inner City Roads
Central Ankamu – Achiase – Swedru
Central Swedru – Bawjiase – Adeiso

Central
Other Selected Cape Coast Inner City Roads
Northern Tamale Interchange
Northern Nalerigu – Bunkpurugu Road
Northern Tamale – Salaga – Bimbilla
Northern Yendi – Tatale
Northern Karaga – Gushegu
Northern and Upper West Wulugu – Kpasenpke – Wa
Upper West Lawra- Han-Tumu
Upper West Lawra-Dikpe Bridge
Upper East Tutulega-Sandema-Wiase
Upper East Navrongo -Naga
Volta Jasikan – Dodo Pepesu – Nkwanta
Volta Have – Hohoe
Volta Hohoe Inner City Roads

Accra Inner City Roads

Greater Accra
Taifa-Burkina-Nkatia Burger-DomeKwabenya Mosque
Christo Asafo Area Roads-Taifa
Pure Water Roads and LinksKwabenya
Fan Milk Area Road-Anyaa
Adu Gyamfi Road-Anyaa
Selected Roads in Anyaa
Apostle Sarfo Onyinase Road
Pentecost University Road
Omanjor to Olebu Road
Abease Road to Ablekuma
A lang Area Road-Sowotuom
Race Course Medical Centre Road

Selected Roads in Gbawe
Nanakrom-Santeo Ashaiman Road
Adenta-Dodowa Road (Dualisation)
Ofanko Hospital Link Road
Abensu Afiama Taxi Road (Trobu)
Israel Junction Sound FoundationBlue Gate and Yeboah Street-Nii Ankraman (Trobu-Amasaman)
Partial Construction of North Ofanko John Teye Bypass
Partial Construction of Yellow House and Links (Trobu-Amasaman)
Partial Construction of AsofanAmamorle Road and Links (Trobu-Amasaman)
Poultry Farm Road (TrobuAmasaman)
Drainage Construction -Confidence and Veterinary-South Ofankor
Demo Road (Ledzokuku)
Allowayto Malik Road (Ledzokuku)

Baptist School Area Tebibiano Road (Ledzokuku)
Sea Lady Road (Ledzokuku)

Teshie North By Pass Road (Ledzokuku)
GIBADA Office Complex

115. Mr. Speaker, in line with our commitment to complete projects commenced under the previous administration, the following ongoing projects will also be financed:

1 Bridge on the Volta River at Volivo
2 Nsawam – Apedwa Road (Kwafokrom – Apedwa Road)
3 Bolgatanga – Bawku – Polmakom
4 Nkwanta – Oti Damanko Road
5 Oti Damanko – Nakpanduri Road
6 Berekum – Seikwa Road
7 Enchi – Dadieso Road
8 Dualisation of Ho Main Roads
9 Ho Bypass
10 Kumasi Roads and Drainage Extension Project

116. Mr. Speaker, in addition to the above, in 2019 Government in partnership with the private sector through PPP arrangements will undertake various projects including Accra–Takoradi Highway Dualisation, Accra – Tema Motorway and Accra – Kumasi Highway Dualisation.

117. Mr. Speaker, now let me turn my attention to the development of Railway infrastructure. Government, in 2018, commenced the rehabilitation of the existing 56 km narrow gauge line from Kojokrom to Tarkwa through Nsuta corridor to restore passenger rail and freight services for the first time since 2007. This will be completed in 2019.

118. Mr. Speaker, work also commenced on rehabilitation works on the 70.8km narrow gauge sections of the Eastern Railway Line from Accra to Nsawam and Accra to Tema. The Achimota to Tema section is 90 percent complete and Achimota to Accra Central and Achimota to Nsawam will be completed by end of 2018. Rehabilitation will continue to Koforidua in 2019.

119. Mr. Speaker, the feasibility studies for the proposed 596km Greenfield Railway Line from Kumasi to Paga, popularly known as the Central Spine, has been undertaken. Phase 1 from Kumasi to Buipe section will commence in 2019.

120. Mr. Speaker, the following feasibility studies commenced and will be pursued in 2019: a. rail link on BOT basis between the Tema Port and Ouagadougou, Burkina Faso; b. Development of Metro / Light Rail Transit Systems in Accra and Kumasi such as the recently signed Accra Sky Train project; c. Trans-ECOWAS line from Aflao through Cape Coast to Elubo; and d. Re-development of the Central Line from Kotoku in the Greater Accra Region to Huni Valley in the Western Region.

121. Mr. Speaker, the Railway Location Workshop, also at Essikado, is being modernised and equipped, and will be completed in 2019 to become a one-stop workshop to serve the railway, mining, petroleum and agricultural industries. We are confident, 2019 will witness the relaunch of the railway system in Ghana.

122. Mr. Speaker, it is of major concern to Government that in this day and age, many of our people do not have access to potable water. As such, under the “Water for All” agenda, we will ensure the continuous expansion of urban water systems in the country. Systems to be expanded in 2019 and over the medium term include the Kpong Water Supply Expansion Project – phase 2, Aqua Africa Water Project, Yendi Water Project, Damongo Water Project, Wenchi Water Project, Tamale Water Supply Expansion Project, Sunyani Water Project, Sekondi-Takoradi Water Project and Essiama Water Project.

123. In 2019, Government will lay 190 km of pipelines across the country. We will also construct 9 water systems each in the Northern Region and Central Regions, 5 in Brong-Ahafo Region and 2 in the Upper West Region. Additionally, Government will construct 12 fully reticulated small towns pipe systems and 6 limited mechanised systems in the Volta Region.

124. Mr. Speaker, as part of the overall strategy to position Ghana as a transport and logistics hub, Government continued to develop the port infrastructure through the construction of new container terminals at the Tema Port to increase container handling capacity, provide additional berths, reduce waiting time and ensure quick access to the Port. The first berth with a depth weight capacity of 16.0 metre is 42 percent complete and is scheduled to be operational by 2019.

125. Mr. Speaker, to develop the Takoradi Port as an Oil and Gas hub, Government commenced the development and operation of an on-dock container multi-purpose terminal with a container quay of 16-metre draft to accommodate bigger vessels. The first phase of the Dry Bulk Jetty which involves the construction of the 600m quay wall was completed. The second phase of an additional 200m quay wall will commence in 2019.

126. Government also facilitated the construction of the Anloga fish landing site to enhance the productivity of fishers. In addition, detailed construction designs and Environmental Impact Assessment studies were completed for landing sites at Teshie, Axim, Winneba, Mumford and a fishing harbour complex at James Town. Actual construction on these landing sites as well as the Phase II of the Anomabo Fisheries College will commence in 2019.

127. Government has completed the first phase of the Elmina Fishing Port Rehabilitation and Expansion project which includes upgrading the existing fishing port as well as the construction of a new port with a basin area and a quay wall for vessels to moor and offload. The second phase of the project which will commence in 2019 will entail the construction new facilities such as shed for the fish market, fishing net mending and theconstruction of a new slipway for bigger vessels with a boat refurbishment area.

128. To complement the multi-modal transport system and support the movement of people and goods within the sub-region, the Ministry commenced work on the Kumasi Airport Phase II Project to upgrade it to a real international airport. The works include extension of the runway from the current 1,981 metres to 2,300 metres, construction of new terminal building to handle 1 million passengers per year and other ancillary works. The project is expected to be 30 percent complete by the end of 2018. Implementation will continue in 2019.

129. Mr. Speaker, work on Tamale Airport Phase II received regulatory approvals for the construction of a new Terminal building and will serve the Sahelian region. In 2019, the contract agreement will be finalised, and construction works commenced. The project is expected to be 65 percent complete by the end of 2019.

130. Finally, Mr. Speaker, Cabinet has given approval for the establishment of a Home-Based Airline with private sector participation to provide regional and inter-continental services for efficient movement of people, goods and services as well as promote tourism. Strategic investors will be engaged, and the airline is expected to commence operations in 2019.

131. Mr. Speaker, to address the inadequate health facilities that continue to bedevil our fellow Ghanaians, Government has:

a. received Parliamentary approval for a USD50m loan to complete Phase II of the University of Ghana Medical School which is awaiting the conclusion of a Value for Money audit;

b. converted the Ho Regional Hospital to a teaching hospital;

c. commenced the process for upgrading the Hohoe Municipal Hospital to a Regional Hospital. d. will construct a total of 15 CHPS compounds; 2 in Greater Accra Region, 5 in Brong-Ahafo Region, 2 in Ashanti Region, 3 in Eastern Region and 3; and e. will construct 1 District Hospital and 5 Polyclinics in Western Region and equip 4 selected facilities at Aburi, Kyebi, Atibie and Mampong.

132. Mr. Speaker, structural work on the new 500-bed military hospital at Afari, near Kumasi, is about 65 percent complete, and full completion expected in 2019. In 2019, work will also start on the 3rd phase of the 37 Military Hospital project in Accra.

133. Mr. Speaker, to boost housing supply and strengthen coastal protection, Government will continue to work on several projects, such as the Saglemi Housing project, where 4,100 of 5,000 homes will be completed in 2019, and the Cape Coast, Anomabo and Anyanui-Keta coastal protection works. Government Affordable Housing Project at Asokore-Mampong for 1,030 housing units is 90 percent complete.

134. As announced in the 2018 Budget statement, work has been completed for the start of the pilot phase of the Mortgage and Housing Finance Market Scheme in November 2018. An amount of GH¢40m has been released for the pilot phase which will leverage additional private sector funds of GH¢40m from pensions, insurance and collective investment schemes through selected commercial banks. Mr. Speaker, a vibrant mortgage and housing finance ecosystem is key for social equity, economic development and job creation.

135. To scale up this initiative in 2019, Government had committed to a GH¢1 billion mortgage and housing finance fund which will be seeded with a minimum of GH¢100m every fiscal year over the next 5 years. This effort will support private sector in expanding access to housing and deepen the local mortgage and construction finance market. The focus on fixing the financial system to support home-ownership by large segment of the populace is critical in government effort to enter into a social compact with labour.

136. Government through SHC is looking to partner with private sector developers to deliver housing across the country in every region and to complete all the uncompleted housing projects across the country.

137. By encouraging the delivery of more homes under a variety of demand driven initiatives, such as lower mortgage interest rates, rent-to-own schemes, dedicated income deductions for home ownership, and lowering the cost of home delivery; we can create a housing market that works for everyone, meeting the diverse housing needs of our country.

138. Mr. Speaker, a total of 50 units of townhouses and 24 units of flats at Roman Ridge will be completed by the end of the year for Public and Civil Servants under the Redevelopment Programme. Starting in 2019 and over the medium-term, about 200,000 housing units of various types will commence in all the regional capitals of the country towards reducing the national housing deficit.

139. To mitigate accommodation and housing deficit in the military, the Government continued the SSNIT Housing Projects at various Garrisons in Accra, Tema, Ho, Tamale and Sekondi Takoradi, and expects completion in 2019. The first phase of the four 16 units Housing Projects under the Barracks Regeneration Project will be completed and commissioned before the end of this year, and the second phase will commence in 2019. The second phase of the Security Agencies Housing Project comprising 368 housing units for the Ghana
Navy has been completed. The Phase III comprising 320 housing units for the Ghana Police Service has commenced and will continue in 2019.

140. Mr. Speaker, in connecting Ghana through digitisation and communication, Government established 400 telephony sites to provide voice signals to 2,000 unserved communities to bridge the digital divide and ensure nationwide coverage by 2020. In 2019, government will deploy an additional 600 telephony sites to provide voice signals to 1800 communities where coverage is limited or non-existent due to the inability of existing license operators to expand their networks.

141. The construction of the ICT Technology Park to provide multitenant infrastructure at Dawa through a PPP arrangement is ongoing and is expected to be completed in 2019. 142. Mr. Speaker, a Concessionaire has been selected to assume responsibility of ECG’s core business of power distribution and shall be required to invest half a billion dollars in the network to improve efficiency and reduce commercial and technical losses.

143. Mr. Speaker, the rural electrification programme will be continued in 2019 using electrical conductors and cables, exclusively from local manufacturing companies. The move is to support the local manufacturing industry and boost employment.

144. Government undertakes to complete the extension of electricity to the whole country and is committed to work with local banks and entrepreneurs that are ready to invest in the energy sector.

145. Mr. Speaker, in line with our belief in investing in human capital, education is about to witness the largest capital expenditure in the sector for any single year in the last 50 years. Government will continue to ensure that these investments lead to an increase.

146. Government has presented to Parliament, a proposal to secure up to US$1.5 billion long-term financing for GETFUND on the back of a portion of VAT receivables as prescribed in Act 581, and which will be issued in three (3) tranches of US$500.00 million. This will be used for critical education infrastructure, especially to complete the numerous uncompleted buildings in secondary and tertiary institutions around the country.

147. Mr. Speaker, in 2019 government will commence work to upgrade 10 Technical Universities /Polytechnics and 13 Technical Institutes with modern equipment and also train selected lecturers of these institutions. 148. To further develop the TVET sub-sector, we will commence the construction of 20 state-of-the-art TVET Centres as well as upgrade and retool 34 Vocational Training Institutes in 2019. In addition, two new centres in foundry and machining will be constructed.

149. Mr. Speaker, as part of its drive to promote Science, Technology, Engineering and Mathematics (STEM) education across all levels, Government will in 2019 roll out the BSTEM programme in 7,000 basic schools across the country; construct 10 STEM Centres; initiate the development of a knowledge cloud to make educational materials content accessible to all; and provide multimedia laboratories as well as internet connectivity to cover many more schools.

150. Mr. Speaker, in 2018, Government also cut-sod for the construction of a multi-purpose Youth Resource Centres in every region of the country. Construction work has started at all the sites and are at various levels of completion. The centres will provide space for youth engagement, recreation, centres of learning and sports. 151. Mr. Speaker, Under the Zongo Development Fund, five Astro turfs (with spectator stands and dressing rooms) were constructed at Madina, Kyebi and Walewale. In addition, five recreational parks were completed for use at Bolgatanga, Salaga, Yeji, Tafo-Kumasi and Akim Oda.

152. Mr. Speaker, in addition to the several projects in agricultural warehouses, dams and dugouts, supply of ambulances, building of water and sanitation facilities, and markets, in 2019, IPEP, through the Development Authorities, will go into full drive in the supply and delivery of constituency-specific Infrastructure, including drainage systems, footbridges, renovation of schools, community town centres, reshaping of roads, among others.

153. National Cathedral: Mr. Speaker, on March 6, 2017 – the 60th year of our independence – the President cut the sod for the construction of a National Christian Cathedral for the country that will provide the space for national events of a religious nature. A National monument, the Cathedral will house impressive chapels and baptistery, 5000-seat main auditorium, expandable to 15000 people for national events and celebrations. It will include among others, a grand central hall, a music school, and will house Africa’s first-ever Bible Museum and documentation centre, The National Cathedral project will also bequeath to the country a gracious national park for all Ghanaians; bring new skills, technology and jobs to the country; and will act as a beacon to national, regional and international tourists. Mr Speaker, the state is facilitating this process by providing the land, the Secretariat, and seed money for the preparatory phase.

154. Mr. Speaker, the President is determined that the building of the National Cathedral would not put undue financial burdens on the state. He has therefore proposed a partnership between the State and the Ghanaian Christian community both at home and in the Diaspora. The formal launch of this national fundraising campaign is slated for December 28, 2018 in Ghana, and February 2019 in the United States. This National Cathedral partnership framework operationalizes, and indeed is a practical expression, of the social partnership envisaged to foster participatory development of country as our collective goal.

155. Mr. Speaker, the Creative Arts Industry Bill is now in Parliament for deliberation and passage into Law. The Creative Arts Fund is incorporated in the Bill to ensure the economic viability of the Creative Arts Sector in the economy. In addition, Government in 2019, will pursue the passing of a Legislative Instrument to establish a Secretariat for the National Film Authority” and will also facilitate the construction of an ultra-modern Film Production Studio to attract the international film community.”

156. To commemorate the 400 years of slavery, a delegation led by His Excellency, the President, Nana Addo Dankwa Akufo-Addo went to the USA to declare 2019 as the YEAR OF RETURN in September this year. The Ghana Tourism Authority is leading this campaign that will see a great number of African Diaspora from the United States of America, the Caribbean and the United Kingdom return to Ghana on a pilgrimage to promote heritage tourism in 2019.

See full budget below;

2019 Budget Speech _ Final Draft in template 15.11.2018 copy

 

Source: www.newswiregh.com

 

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