Finance Minister Dr. Cassiel Ato Forson has announced that the government will align its expenditures with the country’s fiscal realities to promote economic stability.
Speaking during the 2025 Budget Presentation on Tuesday, March 11, 2025, Dr. Forson emphasized the need for responsible spending to align with Ghana’s current economic conditions.
“Mr. Speaker, going forward, we will tailor our expenditures to align with our fiscal realities. After all, “whoever pays off their debt gets rich,” he stated.
This, he stated, can be done through a three-pronged strategy aimed at stabilizing the economy and restoring fiscal discipline.
“Mr. Speaker, we are poised to implement a three-pronged approach to achieve our objectives, beginning with this budget: Recalibrate the fiscal adjustment. We believe that prioritizing a spending-led fiscal adjustment can initiate a positive cycle. Firstly, it will help lower inflation and curb the depreciation of the cedi. Secondly, it will lessen the government’s reliance on borrowing, which in turn will reduce the crowding out of the private sector and lower interest rates. Lastly, this approach will ease the strain on monetary policy, allowing the Bank of Ghana greater flexibility to reduce monetary policy rates, ultimately resulting in lower bank lending rates.
“Deliver a shock therapy. We are implementing a form of “shock therapy” to the economy by making significant spending cuts this year, thereby reducing the government’s financing needs and front-loading fiscal adjustment. This is the down payment for our policy credibility and creditworthiness.
“Restore fiscal responsibility. Moving forward, we will enhance public financial management by: i) Empowering ministers to effectively manage their budgets; ii) Ensuring strict compliance with the commencement certificate system; iii) Passing and enforcing the revised Fiscal Responsibility Act; and iv) Enforcing sanctions for non-compliance,” he stated.
