Finance Minister, Ken Ofori-Atta, says the country’s transformation agenda to mitigate the dire effects of the Covid-19 pandemic on the economy is still on course.
Presenting the 2021 Mid-year Budget Review to Parliament on Thursday, July 29, Mr Ofori- Atta, noted that the exchange rate, inflation rate and Foreign Direct Investment (FDI) have been stable amidst the pandemic.
These successes chalked, he said, reveal that the government is managing the finances of the country with discipline and competence.
“Mr Speaker, I would like to note that notwithstanding our elevated debt levels as a result of COVID-19, our inflation rate is lower than it was in 2016, our interest rates are lower than they were in 2016, our exchange rate is more stable than it was in 2016, our foreign exchange reserves are much higher than they were in 2016, and we did not have to lay off any worker, nor cancel teacher and nursing training allowance.
“Mr Speaker, on inflation, we are witnessing one of the lowest numbers on record in about two years. Inflation, which, at the height of the pandemic, hovered around 11.8 per cent, dropped to 7.5 per cent in May 2021 before inching up slightly to 7.8 per cent in June.
“The cedi has been relatively stable in the past four years, and maintained its stability even in this pandemic year. For the first time in the Fourth Republic, the exchange rate did not see a spike after an election year. Cumulatively, from the beginning of the year to date, the exchange rate has depreciated by 0.6 per cent against the US Dollar and appreciating by 3.6 per cent against the Euro. This stability is expected to continue as we move towards the close of the year,” he told the House.
According to the Finance Minister, as of June, the FDI accrued by the country was $954.2 million. In comparison with $557.2 million recorded over the same period last year, there has been a 71.2 per cent increase.
He, therefore, assured the House that the “nation’s transformation agenda is very much on course.”
“Mr Speaker, the strong rebound in growth, the low inflation rates, the stable currency, the strong reserve position and FDI flows are clear indicators of economic recovery.
“Indeed, the strategic investments we collectively made in building strong economic fundamentals in the three years prior to this pandemic, as well as the subsequent speed, scope and scale of our socio-economic response to the pandemic, is fueling our recovery,” he added.
Meanwhile, despite the relatively low inflation rate, Mr Ofori-Atta has revealed the Bank of Ghana has put in place monetary policies to ensure the desired 8 per cent rate is achieved and maintained.
On the matter of unemployment, he also stated government is ready with a comprehensive programme to create a million job opportunities for the youth in the next two and a half years.