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Ghana heads for biggest fiscal deficit in history

The International Monetary Fund (IMF) is predicting that Ghana’s fiscal deficit will reach 16.4 per cent of GDP this year, the largest in the country’s history.

The Fund’s bigger projection, which was contained in its October 2020 Fiscal Monitor publication, appears to take into account the expenses incurred by the government in cleaning up the financial and energy sectors – costs which government has consistently excluded from its fiscal deficit calculation.

The projection is not only the largest in Ghana’s history, it also means the country will see the biggest fiscal deficit in sub-Saharan Africa.

Also, the report projects that the government’s debt will increase from 62.8 per cent of GDP in 2019 to 76.7 per cent in 2020, before declining to 74.7 per cent in 2021.

Oct. 26, 2020

References:

• https://www.ghanaweb.com/GhanaHomePage/business/Ghana-heads-for-biggest-fiscal-deficit-in-history-1092970
• https://ghanafinancialmarket.wordpress.com/2020/10/26/ghana-heads-for-biggest-fiscal-deficit-in-history-16-4-of-gdp-by-end-of-2020-imf/
• https://www.imf.org/en/Publications/REO/SSA/Issues/2020/10/22/regional-economic-outlook-sub-saharan-africa
• https://www.imf.org/en/Publications/FM/Issues/2020/09/30/october-2020-fiscal-monitor