Ghana's finance minister on Friday said the economic outlook was brighter going into 2016, as the country heads towards presidential elections. Seth Terkper said the government in Accra was aiming for overall GDP growth of 5.4 percent, to cut inflation to 10.1 percent and further reduce the country's fiscal deficit.
"We now see brighter prospects ahead," he told parliament. "There is a clear sign that our fiscal consolidation efforts are yielding positive results, making the economy more efficient. "Accordingly, the GSS (Ghana Statistical Service) estimates that GDP will grow at 4.1 percent at the end of 2015 compared to the 3.5 percent initially projected." Ghana's economy, historically reliant on cocoa and gold exports, took off in 2010 after the discovery of oil, hitting 14.0 percent growth that year, making it an attractive emerging market. But it has been on a downward trajectory ever since, hit by falling global commodities prices and spiralling public sector debt that has weakened the cedi currency.
Growth has has levelled off at about 4.0 percent since 2014, according to government figures. The International Monetary Fund has imposed a budget deficit target on Ghana of 5.3 percent of GDP as part of a $918 million loan agreement to boost growth and job creation. Terkper said it was "on target" to meet that in the coming year, as the pace of public debt had slowed in the first half of this year. But he said the "tighter fiscal space" because of the IMF agreement meant the government "must be even more prudent in 2016".
Terkper said the government was targeting 8.2 percent annual growth by 2018. "We will resist the temptation of election year overspending," he said. President John Dramani Mahama is expected to seek re-election at the polls against opposition leader Nana Akufo-Addo. A date has not yet been set.
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