Mr. Kwame Peprah, Minister of Finance on Wednesday presented the government's financial and economic policy to Parliament, projecting an average GDP growth rate of 5.4 per cent for the 2000-2002 medium term and an end of period inflation rate of eight per cent.

In the 89-page document, Mr. Peprah put the average overall broad budget deficit equivalent to four per cent of GDP, an average primary budget surplus equivalent to 3.1 per cent and an overall balance of payments surplus of 107 million dollars for the three-year period.

For the year 2000, a real GDP growth is targeted at five per cent, with an end-of-period inflation of 12.5 per cent.

Budget deficit for this year is projected at 6.1 per cent of GDP with a zero position target in overall balance of payments.

Mr. Peprah said the projected five per cent growth of GDP for year 2000 is based on a projected growth of 4.2 per cent in the agricultural sector, 5.1 per cent in industry and a 5.9 per cent growth in services.

Mr. Peprah said in line with the overall macro-economic targets for 2000, receipts are projected at 8,633.1 billion cedis, representing tax revenue of 4,299.4 billion cedis, non-tax revenue of 420.0 billion cedis, foreign grants of 961.6 billion cedis and divestiture receipts of 456.8 billion cedis.

He said project and programme loans are projected at 1,322.5 billion cedis and 694.8 billion cedis, respectively. Net domestic financing of the budget is estimated at 548 million cedis.

Total payments for 2000 are estimated at 8,633.1 billion cedis. Out of this, statutory payments are estimated at 3,314.3 billion cedis, while discretionary payments are programmed at 5,318.8 billion cedis.

Interest payments are projected at 1389 billion cedis, out of which 911 billion cedis is for payment of domestic interest.

An amount of 161.8 billion cedis has been provided for transfers to households, namely pensions and gratuities.

It is estimated that an amount of 303 billion cedis will be transferred into the Road Fund, while 200 billion cedis which will be generated through additional VAT receipts is expected to be transferred into an Education Trust Fund.

Personal emoluments (including Government contributions to SSNIT on behalf of its workers) are estimated to rise from 1,516.3 billion cedis in 1999 to 1,722 billion cedis in 2000, while the District Assemblies Common Fund (DACF) is projected at 211,5 billion cedis.

Investment expenditure for 2000 is estimated at 2,654.8 billion cedis of which domestic financed investment expenditure is 631.3 billion cedis.

Mr. Peprah said under the MTEF for 2000-2002, total resources for the three-year period amounts to 24,867.7 billion cedis.

Of this, 8,633.1 billion cedis is earmarked for 2000, while indicative amounts of 6,390.2 billion and 7,844.4 billion are programmed for 2001 and 2002, respectively.

Total statutory obligations are 3,314.3 billion cedis for 2000 with 3,065.9 billion and 2,922.9 billion cedis estimated for 2001 and 2002 respectively.

Discretionary expenditures for the medium term amount to 15,564.5 billion cedis out of which 5,318.8 billion cedis is budgeted for 2000, with indicative allocations for 2001 and 2002 being 5,324.2 billion cedis and 4,921.5 billion cedis respectively.

Mr. Peprah said over the medium term, statutory payments are projected to go down from 3,314.3 billion cedis in 2000 to 2,922.9 billion cedis in 2002.

This is the result of expected declines in amortisation and interest payments on external debts, as the structure of debt stock changes towards long term debt.

Total discretionary expenditures are also projected to decline as foreign inflows for the financing of investment activities are expected to go down considerably.

The Minister said the District Assemblies Common Fund (DACF) is expected to rise from 2115.5 billion cedis in 2000 to 273.5 billion cedis in 2002.

Total receipts over the medium term are projected to decline from 8,633.1 billion cedis in 2000 to 7,844.4 billion cedis in 2002.

Net domestic financing is projected to decline from 548.0 billion cedis in 2000 to 251.8 billion cedis in 2002.

Project loans are expected to fall from 1,322.5 billion cedis in 2000 to 639.1 billion cedis in 2002.

Similarly, programme loans are also projected to fall from 694.8 billion cedis in 2000 to 347.0 billion cedis in 2002, with total grants projected to decline from 961.6 billion cedis in 2000 to 487.4 billion cedis in 2002.

He said even though total receipts are programmed to decline over the three-year period, total revenue which marks purely domestic effort at resource mobilisation, is projected to rise by about 29 per cent from 4,649.4 billion cedis in 2000 to 5,999.1 billion cedis in 2002.

Total tax revenue is projected to rise from 4,229.4 billion cedis in 2000 to 5,470.1 billion cedis in 2002, while non-tax revenue is programmed to increase from 420.0 billion cedis in 2000 to 529.0 billion cedis in 2002 .

For the five activity sectors classified under the MTEF, discretionary expenditures over the medium term are Administration (31.41 per cent); Economic services (11.04 per cent); Infrastructure (18.43 per cent); Social services (28.59 per cent); and Public safety (9.96 per cent).

In addition, an amount equivalent to 0.57 per cent of total discretionary expenditure has been earmarked for contingency.

The 2000 expenditure profile for these sectors are Administration (38.16 per cent); Economic services (11.89 per cent); Infrastructure (12.21 per cent); Social services (27.75 per cent); Public safety (9.65 per cent); and Contingency (0.36 per cent).

Mr. Peprah said the government's monetary policy objective will continue to be price stability, adding that a stable price level would allow resources to be allocated more efficiently, encourage savings and investments and thereby enhance the environment for sustained economic growth.

Accordingly, the primary objective for monetary policy in year 2000 will be to achieve an end period inflation rate of 12.5 per cent.

Consistent with this objective, monetary growth has been targeted at 16 per cent for the year.

"Towards this end, Bank of Ghana will continue with its tight monetary policy stance, emphasising intensive use of Open Market Operations (OMO), REPOs, swaps and interest rate policy."

The Minister said the thrust of external sector policy in the medium term would continue to be the accumulation of external reserves.

However, given the adverse effects of falling world prices for the country's major export commodities, it is estimated that the overall balance of payments will be zero in year 2000.

Balance of payments projections for year 2000 show that exports will increase by 1.2 per cent to 2,056 million dollars. The value of cocoa exports is expected to decrease by 20.0 per cent to 435.0 million dollars as a result of projected decrease in average price.

However, gold exports are projected to increase by 4.0 per cent in 2000, on the basis of a projected recovery in price.

Receipts from timber exports are projected to increase on account of expected increases in both volume and price for the year 2000, the Minister said.

He projected receipts from timber exports at 210 million dollars, 27 million dollars higher than the 1999 level.

The contribution of other exports including non-traditional exports in total export receipts for the year 2000 is expected to be 682 million dollars, an increase of 77 million over the 1999 provisional out-turn.

The current account balance (excluding official transfers) is projected at a deficit of US$684.0 million (10.7 per cent of GDP). Including official transfers, this deficit will reduce to 379.0 million dollars (5.9 per cent of GDP).

Mr Peprah said net capital inflows are expected to amount to 379.0 million dollars, of which official capital is projected at 264.0 million dollars, a net private capital inflow of 100.0 million dollars, and short term capital of 15 million dollars.

Mr Peprah said Ghana's total outstanding debt is estimated to decrease to 5.5 billion dollars in 2000 and to remain approximately at this level through to 2002.

"The policy of limiting recourse to non-concessionary borrowing will continue to be pursued," he added.

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Overview :1999 GDP grows at 4.4 per cent

Accra (Greater Accra), 9^th February 2000

Ghana's GDP at the close of 1999 grew by 4.4 per cent, about one per cent below the initial projection of 5.5 per cent, and below the 1998 growth of 4.7 per cent.

Mr. Kwame Peprah Minister of Finance, who was presenting the 2000 budget statement to Parliament on Wednesday, blamed the stagnation of last year's GDP growth on declining prices of cocoa and gold, the country's major cash earners.

He said most of the macro-economic aggregates were on target during the first half of the year but they experienced sharp reversals as a result of the impact of the external pressures mounted in the second half of the year.

Agriculture continued to be the lead sector though it expanded by 3.9 per cent, considerably lower than the previous year's 5.1 per cent, it contributed 36.5 per cent to total real output.

This was followed by the Service sector with a growth rate of five per cent compared to six per cent in 1998 and contributing 29.2 per cent to real GDP.

The Industrial sector, however, saw a positive growth of 4.9 per cent in 1999 as against 3.2 per cent in 1998 when the sector was adversely affected by the energy crisis.

The sector's contribution was 0.1 per cent above the 1998-output level at 25.2 per cent.

Mr. Peprah said the 12-month end-of-period inflation, which stood at 15.7 per cent in December 1998, decelerated further throughout the first five months of 1999 to reach a low level of 9.4 per cent in May, the lowest since March 1992 when a 7.3 per cent inflation was recorded.

However, due to unanticipated fall in commodity prices, the rate of inflation increased to 13.8 per cent in December 1999.

Regarding deceleration in food price, inflation was much faster than that for non-food.

He said that after dropping from 21.8 per cent in December 1998 to 12.4 per cent in March 1999, the rate declined sharply to 5.2 per cent in April last year.

It remained in single digits throughout the rest of the year with the lowest rate of 3.8 per cent in May.

On the contrary, the Minister said, non-food price inflation more than doubled from 10.3 per cent in December 1998, to 20.8 per cent in December last year.

Mr. Peprah said computation of the average yearly inflation, which resumed in September 1997, recorded 13.1 per cent for September 1999. It declined in the last quarter of the year to reach 12.4 per cent in December.

The Minister said in the circumstances of unfavourable external pressures, the government's fiscal balance and the overall balance of payments position suffered relative to both the 1998 out-turn and the projection for 1999.

"With the contraction in external reserves resulting from falls in export receipts and donor inflows, the exchange rate of the cedi also fell markedly."

In tandem, both domestic interest rates and the inflation rates recorded upturns after declines during the first half of the year, he said.

Mr. Peprah said the Crops and Livestock sub-sectors led the growth under Agriculture by 4.7 per cent compared with the previous year's result of 4.4 per cent.

The forestry sub-sector recorded 6.8 per cent, lagging behind the 1998 growth rate of 10 per cent. Output growth rate of one per cent was made in the Fisheries sub-sector as against 1.8 per cent growth in 1998.

The lower growth rate in Agriculture was mainly as a result of the negative 0.5 per cent recorded by the Cocoa Production and Marketing sub-sector.

He said with regards to Industry, growth in the manufacturing sub-sector increased from four per cent in 1998 to 4.8 per cent in 1999 while electricity and water made a strong recovery from a growth rate of negative 10 per cent in 1998 to positive 7.8 per cent last year.

Construction also grew to 5.5 per cent in 1999 from five per cent in 1998.

The Minister said the Mining and Quarrying sub-sector recorded a low growth rate of three per cent in 1999 compared with 6.1 per cent in the previous year.

This, he added, was the direct result of the slump in the world market price of gold.

Under the Services sector, the second largest of the economy after agriculture, Mr Peprah said the Transport, Storage and Communication, Wholesale and Retail, and Restaurants and Hotels sub-sectors experienced higher growth in 1999 than in 1998.

The others, particularly, Finance, Insurance, Real Estate and Business Services and government services grew at lower rates last year as compared to the 1998 levels.

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Agriculture : Food security is key policy in budget - Peprah

Accra (Greater Accra), 9^th February 2000

Mr. Kwame Peprah, Minister of Finance, told Parliament on Wednesday that the promotion of agriculture to ensure sustainable food security is a key policy in this year's budget.

"The storage of agricultural produce during good harvests for eventual consumption in lean periods will continue to engage government's priority attention this year," he said in his budgetary statement to the House.

The government has, therefore, proposed a number of measures to be implemented from this year to reduce considerably the level of post-harvest losses of food crops and vegetables.

Mr. Peprah said the government has in addition designed specific interventions, to further support private sector participation in mechanisation services, cocoa services, livestock development, seed multiplication, plantain production, non-traditional exports, fisheries and internal and external marketing of agricultural produce.

"The activities of this sector, being predominantly private sector-led, will be enhanced by the streamlining of measures to ensure adequate financing of entrepreneurs in the sector through the banks, micro-finance institutions and other schemes in the short term."

The Minister said the Agricultural Development Bank (ADB) is providing 2.4 billion cedis for post-harvest activities including marketing and processing.

"In order to support the local poultry industry against unfair competition, the government proposes that all veterinary drugs as well as ingredients for the manufacture of poultry feed be exempt from import duty."

Mr. Peprah said a loan facility of $ 20.2 million from the African Development Bank (AfDB) and another $ 30.0 million from the Citibank of United States of America have been channelled through the ADB.

The ADB would on-lend to private sector participants in agricultural production and marketing on friendlier terms to execute already identified and prepared projects.

In addition, Mr. Peprah said the government will raise the level of public investment in agriculture with the view to providing the necessary infrastructure that will enhance production through the Agricultural Services Sector Investment Project (AgSSIP) as a long-term measure.

This year, he said, work would begin on small-scale irrigation schemes at 12 locations throughout the country at the cost of US$ 10.3 million.

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Elections : Electoral Commission allocated 37.1 billion cedis

Accra (Greater Accra), 9^th February 2000

The government has allocated a total of 81.9 billion cedis to the Electoral Commission (EC) for its programmes and activities in the medium term spanning 2000 to 2002.

This represents 37.1 billion cedis, 35 billion cedis and 19.8 billion cedis for the years 2000, 2001 and 2002, respectively, Mr. Kwame Peprah, Minister of Finance said in Accra on Wednesday.

Mr. Peprah who was presenting the budget statement for the 2000 financial year to Parliament, said this year's allocation includes the 23.5 billion cedis required for the presidential and parliamentary elections.

The amount also covers the revision of the voter's register.

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Food & Agric : Food and Agriculture Ministry takes 179.9 billion cedis

Accra (Greater Accra), 9^th February 2000

The Ministry of Food and Agriculture has been allocated 174.9 billion cedis to pursue its traditional activities of promoting and diversifying the sector.

These include the processing and marketing of agricultural production for domestic and export markets.

Mr. Kwame Peprah, Minister of Finance, said this when he presented the budget statement and the government's financial and economic policy for the year 2000 to Parliament on Wednesday.

He said in order to accelerate the rate of agricultural production, a number of short term interventions to assist the private sector are to be carried out by the Ministry during the year.

These include a 50.2 million-dollar loan facility to be channelled through the Agricultural Development Bank to the private sector.

Key research areas and major activities to be promoted include expansion of the foundation seed and promotion of partnership with the private sector.

Mr Peprah said a more viable seed and planting material production unit would be established to provide the needed quality seed and planting materials for expanded agricultural production with special focus on rice and plantain production.

Also to be undertaken is the promotion of at least six private sector plantations for the production of plantain and bananas.

This will be on about 500 hectares in selected zones in the Brong Ahafo, Ashanti, Central, Eastern, Western and Volta regions, especially around the Volta Lake.

Also to be promoted will be a selection of a number of well-established non-traditional exports, including pineapple, pawpaw, french beans and chilli pepper for export.

With regard to the livestock sub-sector, the Minister said a number of private livestock fattening and dairy production centres will be established in selected localities.

It is envisaged that in the first year of this pilot programme a total of 1,750 cattle, 10,500 sheep, 10,500 goats and 8,640 pigs, will be raised at a total coast of about 5.5 billion cedis.

He said scientific fisheries research results will be made available to fish farmers.

Twenty-one hatcheries and fish ponds will be supported to produce 40 to 50 tonnes of fish per year.

As part of its farm support services, the Agricultural Mechanisation sub-sector will assist the private sector to establish six mechanisation and input centres at Wa, tamale, Techiman, Ejura/Atebubu, Donkorkrom and Akuse/Kpong to facilitate mechanised farming in these areas.

These centres, when established, will provide our farmers with modern farming techniques.

He said as part of its extension services, a number of private farm services companies will be assisted to help in the management of cocoa farms through the provision of spraying, brushing, pruning and mistle-toe control service to farmers.

"Necessary marketing avenues will be created to absorb the anticipated increased output from these interventions by opening wholesaling outlets to farmers."

He said traditional outlets will be assisted for better performance and will be complemented by better organisation of marketing co-operatives for various crops.

Consideration will also be given to the streamlining of the export of the specified non-traditional crops to create better and stronger bargaining positions for exporters.

Mr. Peprah put post-harvest losses of food crops in the country at between 25-30 per cent of total production in the past.

Considering the effect of this situation on national and household food security, post harvest management interventions have been undertaken by the ministry, thus reducing losses to between 10 and 15 per cent currently.

The ministry will also undertake on-farm trials in all the regions on solar disinfestation of the cowpea weevil from the crop.

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Lands & Forestry : Support for Ministry of Lands and Forestry

Accra (Greater Accra), 9^th February 2000

The government has allocated 193.02 billion cedis over the three-year period of 2000-2002 to the Ministry of Lands and Forestry to help it achieve its objectives.

The Minister of Finance, Mr Kwame Peprah in his budget statement to Parliament on Wednesday said for 2000, 69.2 billion has been provided while indicative amounts of 65.4 billion and 58.4 billion have been made for 2001 and 2002, respectively.

He said activities for 2000 would include preparation of a national land-use plan and initiation of the use of negotiable land bonds as an option to financing timely government acquisition.

Title registration would be speeded up to cover all interest in land throughout the country and phasing out of the deed registry.

Action would be initiated to set up one-stop shop offices for land related departments of the ministry in some regions and encourage communities to establish forest reserves and wildlife sanctuaries.

On the Ministry of Mines and Energy, the Minister said a total medium term (2000-2002) expenditure for the sector has been put at 237.9 billion cedis for year 2000; 224.7 billion for 2001 and 154.4 billion for year 2002.

During the fiscal year 2000 the total projected expenditure of 237.9 billion cedis is made up of 178.2 billion from donor inflows and 59.6 billion cedis from domestic development expenditure and other internally generated funds.

"With the enabling environment created by the government for the private sector to play the lead role in the mines and energy sector, private entrepreneurs will continue to propel the development of the mining sector."

Mr. Peprah said airborne geophysical surveys will be intensified by the Geological Survey Department to ensure that the mineral resources of the country are effectively and efficiently explored and exploited.

In this connection adequate provision and appropriate arrangement have been made to fund all the electrification projects announced in the President's State of the Nation Address.

Mr. Peprah said that in the area of renewable energy the government would continue its solar electrification project for homes to cover about 20 communities in the Upper East and Volta regions. Existing biogas prototypes will continue to be monitored.

He said the government would continue to facilitate the private sector financing of the Buipe to Bolgatanga petroleum pipeline and the single buoy mooring facility at Tema for crude oil off loading.

The Minister said the progress made in setting up the institutional and legal framework for the realisation of the West African Gas Pipeline Project in 1999 would be sustained.

He said the Inter-Governmental Agreement would be signed shortly to enable a consortium of investors to mobilise private and public sector financing to execute the project, which is expected to be completed by July 2002 at an estimated cost of 821 million dollars.

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Trade : Ministry of Trade and Industry to play defined role

Accra (Greater Accra), 9^th February 2000

There is the urgent need to provide resources to the productive sectors that will enhance the development and growth of alternative products so as to diversify the economy.

This will help the Trade and Industry sector to play its defined role in this era of globalisation and trade liberalisation, the Minister of Finance, Mr. Kwame Peprah said on Wednesday in his budget statement to Parliament.

He said a total amount of 71.88 billion cedis has been allocated to the ministry to carry out its projects and programmes.

This amount is made up of 19.77 billion cedis from government sources and 52.11 billion cedis from donor sources.

Programmes to be pursued in 2000 include assistance to small and Medium-Scale Enterprises engaged in textile, wood, agro-processing and packaging sub sectors to produce quality products in accordance with international standards.

- Assistance to participants in Destination Inspection Scheme (DIS) to ensure that imported goods are of acceptable quality, especially, with regard to those which impact on health and safety of the consumer;

- Ensuring accessibility to credit and markets for Small, and Medium Enterprises (SMEs).

- Mounting of solo fairs and encouraging participation in trade fairs and exhibitions by companies in the export sector.

- Completion of the first phase of the Export Processing Zone (EPZ) terrace factories.

- Investment drives in targeted regions in pursuit of the gateway project.

- Establishment of a project to address the weak supply base for non-traditional exports through the creation of export production villages in Bongo, Afram Plains, Juabeso-Bia, Dagme West districts and Accra Metropolitan Area.

- To enhance entry into targeted markets, the Ghana Export Promotion Council (GEPC) will organise solo exhibitions in selected ECOWAS countries for the promotion of exports into the sub-regional markets.

- GEPC would intensify its export school operations to help expand and improve further the awareness and export skills of private sector operations.

-It would continue the process of establishing a trade point, which will provide private sector exporters and other stakeholders with a modern source of trade information linked to world markets through the Internet.

GEPC would promote the establishment of additional Export production Villages as a strategy for addressing the weak export supply base and contribute to poverty reduction in deprived communities.

Mr. Peprah said the National Board for Small Scale Industries will focus on the development of the entrepreneurial, managerial and technical skills of SMEs to sharpen their competitiveness and raise their market readiness and improve SME's access to formal credit, with special attention focused on women-owned enterprises.

The Minister said the Ghana Standards Board would use the Destination Inspection Scheme to intensify its enforcement of standards to ensure that imported goods are of acceptable quality with respect to the protection of the safety and health of consumers.

He said the Ghana Free Zones Board would encourage partnerships between local and foreign investors in the zone's activities.

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Tourism: Ministry of Tourism to focus on 15-year Plan

Accra (Greater Accra), 9^th February 2000

The focus for the Ministry of Tourism in the 2000-2002 medium term will be on the implementation of the 15-year National Development Plan, Finance Minister, Kwame Peprah, said on Wednesday.

This will be done in collaboration with identified stakeholders comprising public and private sector institutions, donor agencies, communities and non-governmental organisations.

Mr. Peprah who was presenting this year's budget to Parliament said 19.8 billion cedis has been made to it for the realisation of the sector's objectives in the medium term.

For the year 2000, 5.8 billion cedis has been provided while the indicative amount of 6.5 billion cedis and 7.5 billion cedis have been allocated for the year 2001 and 2002, respectively.

He said infrastructure and superstructure investments would be embarked upon with emphasis on historical heritage, cultural, ecological, recreational and conference tourism.

In addition, 10 pre-feasibility studies for community-based projects will be implemented as pilot projects with a view to generating more employment and income as a means of addressing the issue of poverty in the local communities where tourist attractions are mainly located.

The Minister said in line with the Ministry's objectives, funding is available for sustained and planned strategic marketing of Ghana as a competitive destination.

Ghana will participate in four main international tourism fairs and exhibitions, with more involvement from the private sector.

"The Slave Route Project which will involve the identification, restoration and promotion of all the places, buildings and physical symbols that have direct bearing on the Trans-Atlantic Slave Trade will be pursued."

Other programmes to be pursued will include the celebration of Emancipation Day and the organisation of public awareness programmes on tourism.

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VAT: Government to revise VAT

Accra (Greater Accra), 9^th February 2000

The focus of implementation of the Value Added Tax (VAT) this year is to consolidate the gains made in the second year of operation.

The VAT secretariat will institute new measures that would improve on the level of compliance in the areas of registration of eligible businesses, diligent and consistent collection of VAT by registered traders and the promotion of efficiency and effectiveness in its administration.

Mr. Kwame Peprah, Minister of Finance, told Parliament on Wednesday that the VAT Service would therefore intensify monitoring and surveillance to enhance compliance particularly in the retail and distributive trades.

He said as part of the process of consolidating VAT, the key parameters of the tax, particularly the coverage "will be revised to enhance revenue yield".

He said legislative action would be initiated during the year to narrow the scope of exemptions and bring a lot more supplies into the scope of the tax as part of the measures to realise the projected enhancement in revenue yield.

The Ministry of Finance will make the release of funds to all MDAs which collect non-tax revenue conditional on the presentation of quarterly returns on fees and charges to the Ministry and the transfer of same to the Consolidated Fund.

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Foreign Affairs: Big boost for foreign missions

Accra (Greater Accra), 9^th February 2000

The Ministry of Foreign Affairs is to receive 97.6 billion cedis for this year and 92.2 billion cedis each for 2001 and 2002 under the Medium Term Expenditure Framework (MTEF) for 2000-2002.

An amount of 11.4 billion cedis would be made available to the Ministry to carry out programmes for the co-ordination of Ghana's missions worldwide.

Presenting this year’s budget to Parliament on Wednesday, Finance Minister, Mr. Kwame Peprah, said 40.2 billion cedis has been allocated for large missions, including Abidjan, London, Tokyo, Moscow and Washington.

He said small African missions have been allocated a total of 17.1 billion while others, which fall under the title of "Other Missions," have been allocated 28.9 billion cedis for this year.

"An amount of 500 million cedis has been allocated for the completion of work on the Legon Centre for International Affairs (LECIA) building complex at Legon."

Mr. Peprah said the Ministry would also undertake renovation works on mission buildings in Cairo, Windhoek, Berne, Brussels, London, Riyadh, Ottawa, Tel-Aviv, Beijing, Abuja, Freetown, Cotonou, Lome, Copenhagen, Belgrade, Brasilia, The Hague and Havana.

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Finance: Ministry of Finance given 419.8 billion cedis in medium-term

Accra (Greater Accra), 9^th February 2000

The Ministry of Finance, its departments and agencies, would receive a total of 419.8 billion cedis for the medium term with 132.8 billion cedis set aside for this year.

This was contained in the budget statement for this year, which was presented to Parliament on Wednesday by the Minister of Finance, Mr. Kwame Peprah.

Indicative amounts of 133.1 billion cedis and 153.9 billion cedis have been allocated for years 2001 and 2002 respectively.

Mr. Peprah said the Ministry has also been provided with 26.8 billion cedis to use for the smooth execution of this year's National Population and Housing Census.

The Minister said details in expenditure classification required under the MTEF "necessitated the introduction of a new Chart of Accounts based on a 15-digit code instead of the nine digit code of the previous Chart of Account."

"The Controller and Accountant-General's Department has completed the development and installation of the new system and has began publication of the monthly financial statement. The backlog will be completed by June this year."

Under the MTEF, the VAT Service will open additional offices, recruit and train staff, purchase vehicles and equipment to support control and verification activities.

For the Customs, Excise and Preventive Service (CEPS) targeted projects to be completed this year include the rehabilitation and construction works on staff houses and offices at Kumasi, Paga, Half Assini and the Tema Long Room.

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Local Government : Huge donor support for Local Government

Accra (Greater Accra), 9^th February 2000

Out of the 222.2 billion cedis allocated to the Ministry of Local Government and Rural Development this year, 139 billion cedis is expected as donor inflow.

The years 2001 and 2002 would see the Ministry receiving 209.9 billion cedis and 160.5 billion cedis respectively, the Minister of Finance, Mr. Kwame Peprah said in his budget statement to Parliament on Wednesday.

Urban community upgrading and development programmes in the five metropolitan/municipal areas and 12 selected urban settlements would continue while the Urban Five project for 25 medium-sized towns would start by July this year.

The Minister said work on the establishment of a 20.8-hectare scientific medicinal farm would continue at Aburi as part of the sector's programme of conserving and protecting the nation's generic plant resources.

"Preparations for the establishment of a Community Population Register System in the 16,000 units throughout the country by March 2002 will continue."

Mr. Peprah said that registration coverage for births and deaths would also be increased from 58.3 per cent and 25.3 per cent to 80 per cent and 35 per cent respectively by 2001.

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Interior : Public safety major focus of Ministry of Interior

Accra (Greater Accra) 9^th February 2000

The government is to beef up and equip the Ghana Police Service to enable it to play its central role of maintaining public safety.

Consequently, an amount of 126.3 billion cedis representing 55.5 per cent of total planned expenditure of 227.6 billion cedis for the Ministry of the Interior this year has been allocated to the Ghana Police Service in line with government's commitment towards improving its service delivery.

Mr. Kwame Peprah, Minister of Finance, said this in Accra on Wednesday in his budgetary statement to Parliament.

Mr. Peprah said as part of its programme to ensure adequate protection of life and property, the Police Service will take delivery of Patrol and Riot Control vehicles worth $16.5 million this year.

"Vital crime detection equipment/logistics will also be provided to the Criminal Investigations Department (CID) in 2000.

"The CID will, in addition, be restructured and strengthened," he stated.

Mr Peprah said the major thrust of the Ministry of the Interior would be the adoption of a pro-active posture in the maintenance of law and order, increased efficiency and quality response to crisis situations.

There will also be a continued training of staff and strengthening of institutions under the Ministry, provision of logistics and equipment and continued rehabilitation of deteriorated buildings and facilities.

Mr. Peprah said an amount of 5.5 billion cedis has been allocated to the Police Service to renovate and complete facilities in various Police Stations and barracks across the country.

"Amounts of 39.9 billion cedis and 31.4 billion cedis have been allocated to the Prisons Service and Fire Service respectively for the year.

"The Ghana National Fire Service would this year take delivery of fire fighting equipment worth about US$23.0 million."

The Minister said an amount of 19.9 billion cedis has been allocated to be the National Disaster Management organisation (NADMO) to strengthen disaster prevention and response mechanisms and provide relief to disaster victims.

Training in disaster prevention and containment measures would continue in various communities throughout the country, he stated.

Mr. Peprah said the Judicial Service would construct a new administration block in Accra, computerize 14 High Court rooms in Accra, Tema and Kumasi, and refurbish five High Court registries in Accra, Kumasi and Tema.

It will also rehabilitate existing High Court buildings and bungalows in Kumasi, Bolgatanga, Koforidua, Tamale and Ho, and establish and equip a pilot alternative training centre for dispute resolution in Accra.

The Service will establish 10 Community Tribunals and five specialised courts to deal with issues relating to commerce, tax and land.

The Minister put the budget outlays for the Judicial Service for the medium term at 35.4 billion cedis for this year, 40.7 billion cedis for 2001 and 43.4 billion cedis for 2002.

Mr Peprah said a new ministry of Regional Economic Co-operation and Integration has been established to infuse dynamism into our regional integration efforts.

An amount of two billion cedis has been allocated to set up the new ministry.

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Poverty: Poverty Reduction on course - Peprah

Accra (Greater Accra), 9^th February 2000

The Minister of Finance, Mr Kwame Peprah said on Wednesday that the government's efforts at reducing poverty in the country are steadily yielding positive results, citing the fourth Ghana Living Standards Survey (GLSS4).

The results of the survey indicate that the percentage of the Ghanaian population classified as poor fell by 8.2 per cent between 1992 and 1999 even though the decline was unevenly distributed across geographic regions and socio-economic groups.

Mr. Peprah, who was delivering the budget statement and economic policy of the government for the 2000 financial year, asserts that the improvement in welfare is a direct outcome of government's economic and social policies targeting the poor and the vulnerable groups in society.

"These policies have over the years been backed by annual increments in government expenditures for the social sector, which have had a positive impact as depicted by social indicators," Mr. Peprah said.

Life expectancy at birth in Ghana, now is 59 years, a year below the international target of 60 years, while maternal and infant mortality rates have also declined.

This could be attributed partly to the government's policy of free medical care for the aged, pregnant women and children whose attendance rates have been reported by some regions to have increased significantly with the implementation of the policy.

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New bills : Gov’t proposes two bills

Accra (Greater Accra), 9^th February 2000

The Cheques Bill and the Payment System Bill, to replace the current Bills of Exchange Act will be laid before Parliament this year.

Other major changes expected this year include the establishment of a Real Time Gross Settlement System (RTGS) for high value interbank payments and the introduction of a printer accreditation scheme for printers of cheques and other security measures.

Mr. Kwame Peprah, Minister of Finance, who was introducing the government’s financial policy for 2000, told Parliament that the measure was part of the government's financial sector policy.

He said all Banks, including those established since the freeze on the licensing of new banks was lifted, would be expected to meet internationally accepted accounting, auditing and financial standards, including those relating to capital adequacy and risk exposure as stipulated in the banking law.

Consequently, he said, the licenses of banks that do not meet the prescribed prudential requirements will be withdrawn.

Work is progressing towards the introduction of guidelines and prudential requirements to give effect to Non-Bank Financial Institutions (NBFIs) Act to ensure that all the affected institutions comply with the provisions of that law.

The government will introduce a bill this year that will allow the operation of pension schemes supplemental to the one being run by the Social Security and National Insurance Trust (SSNIT).

Mr. Peprah said such schemes would benefit from tax breaks, and the mobilised funds would be a source for term lending which is vital for the development of mortgage finance in particular, and industry in general.

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Environment: Government votes 241.1 billion cedis for MEST

Accra (Greater Accra), 9^th February 2000

A total sum of 241.1 billion cedis has been made available in the three-year medium term to fund activities and programmes of the Ministry of Environment, Science and Technology.

Presenting this year's budget statement to Parliament on Wednesday, Mr. Kwame Peprah, Minister of Finance said 72.5 billion cedis out of the amount would be expended on programmes planned for the year 2000, focussing mainly on conservation of the environment.

He said a greenbelt zone, which has been in the pipeline for some time now, would be created around the Accra-Tema conurbation.

To further boost the conservation programme, the Ghana Atomic Energy Commission will collaborate with the Council for Scientific and Industrial Research (CSIR) to promote the development and use of biotechnology in the country.

The Commission will also continue supporting the Radiotherapy Centre located at Korle-Bu while the other Radiotherapy Centre for Kumasi will be completed by the end of the year.

He said under the Private Sector Development Project (PSDP), three industry-based Institutes of the Council are being supported to build their capacities to commercialise their research results.

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Roads: 303 billion cedis for roads maintenance

Accra (Greater Accra), 9^th February 2000

The Ministry of Roads and Transport has been allocated 724.5 billion cedis in 2000, 793.8 billion cedis in 2001 and 917.8 billion in 2002, Finance Minister Kwame Peprah said in his budget statement on Wednesday.

He said a total amount of 303 billion cedis out of the Road Fund is proposed to be spent on maintenance works.

The Ghana Highways Authority (GHA) is programmed to spend 175 billion cedis to maintain trunk roads, while the Department of Feeder Roads (DFR) will spend 120 billion cedis for proposed work on the feeder roads network.

The Department of Urban Roads (DUR) is expected to spend 76 billion cedis on maintenance of urban roads.

These allocations, the Minister said, will be used to fund the maintenance, rehabilitation and construction of the various road and bridge projects mentioned in the President's Sessional Address.

He outlined projects listed for rehabilitation works this year as the Sekondi-Inchaban Road (6.3 km); the Adiembra Road with a bridge over the railway line, through Sekondi Central to Takoradi (4.8 km); and the Africana road from the Central Business District of Takoradi to the Harbour (1.8 km).

The others are the road between Ashaiman and Tema. It will include widening of the underpass under the motorway (2.4 km), Tema Manhean Road from the city through the fishing harbour to the new township (3.3 km); and VALCO road from Akosombo through the Tema industrial area (1.5 km).

He said other major road projects not mentioned in the President’s Sessional Address but which will also be continued this year include the Takoradi-Agona junction (63 km); the Kumasi-Kintampo (180 km); Phase II of Jasikan-Yendi; Bamboi-Bole; and the Asankranguaa-Enchi.

The Minister said detailed designs of the Tema-Aflao (166 km) road have been completed, and the Tema -Sogakope section is being processed for tender this year.

He said the tolling system introduced on the Kumasi-Mampong-Ejura and Kumasi-Sunyani roads both as revenue and cost recovery measures to aid their maintenance, will be extended in the course of the year to the Kumasi-Dormaa Ahenkro, Kintampo-Tamale, Tamale-Paga and Tema-Akosombo roads.

A total of 28 bridges are expected to be constructed this year.

The Gbefi Bridge over the River Dayi to link Hohoe and Kpandu will be rehabilitated.

The construction of Mishio Bridge to link the "overseas" areas of the West Mamprusi District to the rest of the Northern Region will begin this year.

Mr. Peprah said provision of basic infrastructural services for the Airport City will be completed for the main constructional works by the private sector to commence.

Phase two of rehabilitation of the Kotoka International Airport (KIA) will continue with the extension of the runway and improvement of terminal facilities.

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Housing :Works and Housing Ministry receives 228 billion cedis

Accra (Greater Accra), 9^th February 2000

An amount of 228 billion cedis has been allocated to the Ministry of Works and Housing to continue with its projects and programmes during the year.

Presenting this year's budget statement to Parliament, Mr Peprah said work will continue on the Korle Lagoon Ecological Restoration Project, the Keta Sea Defence Project as well as the coastal protection and drainage projects contained in the president's Sessional Address.

"Adequate provision has been made for all the key programmes in the water sector planned for execution during the year including all the major water supply systems specifically mentioned in the President's Sessional Address".

He said in order to sustain the maintenance of rural water and sanitation facilities, the training of 2,000 caretakers, 400 mechanics and 100 artisans to manage rural water and sanitation facilities will be carried out during the year.

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Minority parties want less revenue yet high expenditure - Peprah

Accra (Greater Accra), 9^th February 2000

Mr. Kwame Peprah, Minister of Finance, on Wednesday said the petition of the Joint Action Committee (JAC) of minority parties accusing government of economic mismanagement, contained contradictions which would be a derision to any budget.

He said it is preposterous for the government to be asked to reduce its revenue and increase expenditure.

Mr. Peprah who was presenting this year's budget, which he dubbed "Budget of Fulfilment," to parliament said the minority's call "is a classical reversal of basic economic theory and prudent financial management."

"The petition also contained demands, some clearly contradictory which, if acceded to, will compromise the integrity of any budget and make efforts at prudent national economic management look derisory.

"While calling for an immediate withdrawal of increases in university academic user and in hospital fees nation-wide, the petition also asks for a freeze on all layoffs and redundancies in the public sector, a rejection of any increase in the VAT rate and a reduction in petroleum specific taxes.

"What the petition is asking for simply cannot be done. It cannot even form the basis for any rational economic argument."

Mr. Peprah said there are other measures that have been canvassed by the minority from time to time "which we acknowledge ought to be pursued in the effort to stabilise the economy and fulfil the expectations of our people".

He said there is a limit to which expenditure could be cut adding "what we all ought to do is to jointly identify genuine areas of waste or unnecessary expenditure and agree to eliminate and cut these, even if we as individuals or our constituencies are adversely affected."

Mr. Peprah said this should be an exercise which must be objectively done rather than "playing to the gallery and respond to populist sentiments about a one time purchase of a state jet or number of ministers in the system."

He proposed a bi-partisan committee of parliament which should meet officials of the Ministry of Finance to work on the reduction of expenditure.

Mr. Peprah asked the Parliamentary Select Committees to identify expenditures to be legitimately cut instead of the "ritualistic requests" for allocations to the ministries.

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Industry : Government to deepen initiatives to diversify economy

Accra (Greater Accra), 9^th February 2000

The external shocks of the past year have underscored the need for government to deepen its initiatives and strategies to significantly diversity the economy from its reliance on cocoa, gold and timber.

Mr Kwame Peprah, Minister of Finance, told parliament in his budgetary statement that initiatives to emphasise maximisation of value adding in domestic natural resource utilisation and expansion of industries with proven international competitiveness would be pursued.

"In all cases, the creation of employment opportunities will be one of the central objectives of Government support.

"Government is also committed to supporting local industries through policies that will raise the competitiveness of local manufacturers."

Mr Peprah said in pursuit of the above, the initiatives to be adopted will include targeted tax concessions, modifications to the customs tariff regime, public sector procurement of locally manufactured goods, and support for sectors producing inputs for the local manufacturing sector.

Mr Peprah said to encourage the patronage of locally manufactured goods, the government is taking steps to ensure that, as far as practicable, the government’s procurement is effected from local industries.

"Directives to this effect have been issued to MDAs and the Ministries of Finance and Trade and Industry will enforce this directive.

Mr Peprah said there are indications that some foreign companies are engaged in unfair trade practices that are undermining the competitive capacity of some Ghanaian manufactured products.

"The government has assessed the impact of these activities and will soon introduce legislation not only to stop the practice but also to protect local industry.

Government is also undertaking a review of the whole system of exemptions and zero-rating.

The minister said it has been decided that NGOs, which have not been specifically exempted by parliament, should henceforth pay duty on their imports.

Mr. Peprah said to support diversification of non-traditional exports as well as make local industries more competitive, the government will reassess the current levels of corporate tax rates with a view to providing necessary incentives to local manufacturers.

Alternative arrangements to the presentation of tax clearance certificates will be adopted by the Internal Revenue Service (IRS) in order not to disadvantage local industry.

"Government will strengthen the monitoring mechanisms of goods produced under the Free Zones programme to ensure compliance with the law that provides that only a specified percentage of free zones goods may enter the domestic market.

"Government will continue its pursuit of appropriate macroeconomic policies to facilitate lowering of domestic interest rates thereby lowering financing costs to local manufacturers and expanding non-traditional exports."

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World Bank African placed operations under one head

New York (USA) 9^th February 2000

The World Bank has placed the whole of its African division under one Vice President, instead of two.

A statement by the bank on Monday said Callisto Madavo, who was one of the two vice presidents in charge of Africa will, from May 1, assume sole responsibility for the bank's work in Africa.

His co-vice president for Africa, Jean-Louis Sarbib, will be in charge of the bank's Middle East and North African region.

Following the changes, the two vice presidents issued a statement assuring that the changes will not immediately affect bank staff or clients.

"Having one vice president instead of two will be a natural follow-through to the very successful efforts all of us have made since 1996 to build a strong organisation serving Africa along new lines," they said.

Madavo, a Zimbabwean with a doctorate in economics, joined the World Bank in 1969. He was appointed Vice President of the African region in April 1996.

With its high poverty level, Africa remains the focal point of the World Bank's development work. The Africa region is the largest unit of the bank with 1,400 staff.

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Southern Africa faces food shortage

Blantyre (Malawi) 9^th February 2000

Most countries in the Southern African Development Community (SADC) region face a food shortage this year because of extended dry spells or excessive rain, the Famine Early Warning System (FEWS) said in a statement on Tuesday.

Severe dry spells in countries such as Malawi, Zambia and Zimbabwe, especially towards the end of December delayed the planting season. And most farmers who planted with the early rains had to replant as their first crops wilted, the statement said.

Maize, the staple food for most of the region was one of the crops likely to be hard hit by the fickle season with Zimbabwe and Malawi’s harvest likely to be much lower than last season's. This could result in communal households experiencing food insecurity soon after harvest.

Below normal rainfall in most parts of Zambia forced many farmers to delay planting their crops beyond the normal planting time of between late November to mid-December, FEWS said. Some farmers were still planting in early January.

An increase in the demand for maize drove the market prices up by an estimated 19 per cent in December in the southern region of the country and by an estimated 27 per cent in the central and Northern regions.

By the end of November last year, Mozambique's cereal stocks had dropped to 360,000 metric tons compared to 460,000 metric tons in September.

In its update on food security in the region, FEWS said the current rainy season was not conducive to agriculture development.

Most forecasters suggested that the rainfall would be "normal to above-normal" for much of the rain season which generally begins around November through to March.

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Jesse Jackson announces five major US investments in Ghana

Accra (Greater Accra) 9 Feb. 2000

The Rev. Jesse Jackson, U.S. Ambassador to Africa, on Tuesday announced plans by the African- American community to make five major investments in the areas of culture, health, early child education, women entrepreneurship and information technology.

He was speaking at a press conference in Accra as part of a three-day U.S. private sector trade and investment mission to Ghana code-named "Rain/Push Coalition Trade and Investment Mission to Africa".

The team, which arrived in Ghana last Sunday, comprised representatives of 20 private U.S. companies, who are visiting Ghana, Nigeria and South Africa, to seek investment opportunities and establish joint ventures mainly in information technology infrastructure.

Rev Jackson said: "I have asked President Rawlings to constitute an international commission to draw up an extended budget towards the expansion of the Dubois Centre with a view to improving upon the works of W. E. B. Dubois".

He said the African-American Community is ready and interested in providing Internet facilities and books for the centre, adding that "the move is to ensure that the Encyclopaedia Africana, initiated by Dubois, is completed".

Rev Jackson said he and his wife are also mobilising 60,000 dollars to construct two day care centres in two rural communities and to provide interest-free credit to over 11,000 women entrepreneurs within the year.

"We are also working in close contact with the First Lady, Nana Konadu Agyeman Rawlings and the Ministry of Health to provide support for the HIV/AIDS Eradication Programme in Ghana".

This, he said, was important because "AIDS poses a threat to life expectancy and human resource in sub-Saharan Africa, accounting for about 85 per cent of deaths caused by AIDS world-wide.

He said U.S. investment into the AIDS Eradication Programme would focus on sex education and medical care in order to prevent further increase in AIDS cases in sub-Saharan Africa.

Rev Jackson noted that the main focus of the trade mission, however, is to promote investment in Information Technology infrastructure, saying "we have the capacity, capital, skills and the will to bridge the gap between Africa and the developed world in this area.

"There is no Information Technology and telecommunication need in Ghana that we can not meet".

He noted telecommunication and transportation are very necessary for the growth of every nation's economy, adding, however, that with the introduction of the Internet and other wireless, electronic and data communication, transportation is not much of a requirement to link people.

Rev Jackson lauded Ghana's privatisation and trade liberalisation drive and assured that African Americans would take advantage of it and support it for the sustainable development of the Ghanaian economy.

Mr John Mahama, Minister of Communication, expressed satisfaction with the mission, saying, "both government and private sector officials have had fruitful, frank and open deliberations with members of the team".

He said the deliberations have generated a lot of interest, which are poised to lead to several joint U.S. and Ghanaian ventures in the specific areas of the economy.

Mr Mahama said the government is determined to reap the full benefits of the mission, adding, "we would follow up on all the issues discussed during our deliberations to ensure that they reach their logical conclusion".

The team leaves Ghana tomorrow for Nigeria and South Africa.

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