Ghana sets 4.8% budget deficit of GDP in 2012 fiscal year

Ghana is targeting an overall budget deficit of 4.1% of gross domestic product (GDP) in the 2012 fiscal year, Finance Minister Dr. Kwabena Duffuor told lawmakers today November 16, 2011 when reading the 2012 budget statement.

The government last year set the 2011 fiscal budget deficit target of 5.1% of GDP.

“Overall budget deficit equivalent to 4.8 percent of GDP” Dr Duffuor told Parliament when he gave details of the macroeconomic targets for fiscal 2012.

He said this can be achieved by strengthening expenditure management, and enhancing revenue mobilisation.

According to the Minister, as at the end of 2008, the fiscal deficit on cash basis was 8.5% of GDP (14.5 percent of GDP – old series). “As at the end of September 2011, it had been reduced significantly to 2% of GDP,” he adds.

Other targets for 2012, Dr Duffour forecasted, are “real non-oil GDP growth of 7.6%; real overall GDP growth of 9.4%; Average inflation of 8.7%; end-period inflation of 8.5 percent; and gross international reserves of not less than three months of import cover for goods and services.”

He said the country’s inflation which was 18.1% at the end of 2008 now stands at 8.40% in September, 2011. “This single digit inflation is real and has been sustained for the longest period of our economic history, from June 2010 to date.”

The Ghana Statistical Service (GSS) in October, 2011 estimates the economy will grow 13.6% in 2011 as compared to the growth of 7.7% in 2010.

By Ekow Quandzie