Amidst high expectations, Ghanaians look forward to bold and realistic solutions in the government’s 2025 budget statement in economic policy, to be presented to Parliament on Tuesday.
This comes in the middle of the implementation of a US$3 billion International Monetary Fund (IMF) loan-supported programme and withdrawal of assistance from the USAID, as the government lays a foundation for the 24-hour economy initiative.
As promised by the government, Ghanaians, individuals and businesses alike are expecting the scrapping of some tax handles, including the Electronic Transfer Levy (E-levy), COVID-19 levy, and 10 per cent levy on bet winnings.
Already, A KPMG/United Nations Development Programme (UNDP) 2025 pre-budget survey has disclosed that over 50 per cent of businesses want the removal of the E-levy and COVID-19 levy.
Stable macroeconomic environment, characterised by low inflationary pressures, interest rates and a strong performance of the Cedi against its major trading currencies, are also high on the agenda of many Ghanaians.
However, the government has been cautioned against spending cuts that would hurt the economy but encouraged to embark on aggressive and innovative revenue mobilisation efforts to augment its expenditure rationalisation.
Dr Daniel Amin-Prempeh, a Chief Economist with the Policy Initiative for Economic Development (PIED), said the budget should translate deliverables into pragmatic and realistic strategies.
That, he said, should anchor the overall growth of the economy, prioritising private sector support and development, particularly in the operationalisation of the 24-hour economy initaitve.
He spoke with the Ghana News Agency ahead of the budget presentation, noting that such support to the private sector must be deliberate to boost their capital and capacity, while creating a market for them within the sub-region.
“They don’t need to start from scratch. There are existing policies by the previous government, which probably are very good policies, but in terms of implementation, in terms of coordination, it couldn’t achieve the desired results. That should be the focus,” said Dr Amin-Prempeh.
He recommended that the government streamlined and invested in the Planting for Food and Jobs (PFJ) programme to create jobs along the agricultural value chain and minimise the importation of stables.
“When these things are well coordinated and there’s a strong policy around these thematic areas, we should be able to consolidate the macroeconomic environment and prepare growth going forward,” he said.
For the Association of Ghana Industries (AGI), they looked forward to policies that would help protect local industries from competition from imports, a stable macroeconomic environment to enable businesses thrive.
“We believe in the 24-hour economic strategy, but we cannot run our industries for 24 hours to produce so much only for us to be exposed to competition from imported products,” Mr Stephen Owusu, the Head of Memberships Development at AGI, said.
He said this at the third US-Ghana Business Expo Roundtable and B2B matching in USA, held last month, urging the government to incentivise businesses to support the 24-hour economy initiative.
In addition to a stable macroeconomy, the Association also asked the government to channel expenditure cuts in areas that industry could fill in.
“We are in challenging times, and the government cannot do everything alone. That is why the private sector is needed. Spending cuts should target areas where the private sector can provide the necessary support,” Dr Humphrey Ayim-Darke, AGI President said.
Speaking in an interview monitored by the Ghana News Agency on JoyNews, Dr Joseph Obeng, the President of the Ghana Union of Traders Association (GUTA), also echoed the need for a stable macroeconomic environment.
“The budget must adopt measures that will strengthen and stabilise the local currency, as this is key to the nation’s economic well-being. These are the indicators that enable businesses to prosper,” he said.
“We need stability, total stability of the economy. That we adopt measures to help strengthen and stabilize the local currency to reduce infiltration, interest rates to improve other economic indicators, especially the interest rate,” he added.
Dr Nyame Baafi, a Senior Lecturer at the Ghana Institute of Management and Public Administration (GIMPA), cautioned against the populist approach in removing some taxes as promised Ghanaians.
He cited revenue constraints and the rippling effect of the scrapping of taxes on the country’s debt-to-Gross Domestic Product (GDP) ratio, as reasons for the government to trek cautiously.
Figures from the Ghana Statistical Service (GSS), has shown a decline in the country’s debt-to-GDP ratio from approximately 80 per cent in 2020 to 61 per cent, alongside a GDP growth rate of 5.7 per cent, but removing some taxes could reverse the macroeconomic gains achieved so far, Dr Baafi said.
Mr Kojo Oppong Nkrumah, the Ranking Member of Parliament’s Economy and Development Committee, said they looked forward to the budget providing funding to various economic policies.
He noted that the new government made some 273 economic commitments ahead of the last election, and they would examine the commitments for each of them, particularly in year one.
“We will bring to bear the knowledge we’ve acquired in government, the lessons from what went right and wrong in our era, and the feedback from our constituents in our assessment and approvals,” he pledged.
