Ghana's Economy being managed prudently - Bank

Accra, July 9, GNA - Ghana's economy is benefiting from 1,113.8 million dollars approved by the World Bank to support her development efforts within the last 12 months Mr Ishac Diwan, the Bank's Country Director, has said.

Mr Diwan, who was addressing Journalists at the Bank's Accra Office on Thursday, said the Board of Directors in June this year approved 728.7 million dollars for various programmes and projects because of the prudent management of the economy.


The Bank approved 70 million dollars as additional financing for Ghana Energy and Access Project; 44.7 million dollars as additional financing for eGhana; 88.6 million dollars for Social Opportunities Project and 25 million dollars for Second Agriculture Development Policy Operation.


The others were 10 million dollars for the Third Natural Resources and Environmental Governance; 75 million dollars for Sustainable Rural Water and Sanitation Project; 143 million dollars for Economic Governance and Poverty Reduction Second Tranche Release and 257.5 million dollars for the Abidjan-Lagos Trade and Transport Facilitation Project.


The Bank had earlier in 2009 approved 15 million dollars as Second Additional Financing for Small Towns Water Supply and Sanitation Project; 225 million dollars for the Transport Sector Project and 10 million dollars for the Second Natural Resources and Environmental Governance.


The monies were approved under the Ghana-Economic Governance and Poverty Reduction Credit (EGPRC).


The EGPRC aims to support Government's efforts in the midst of the current global crisis to bring their fiscal stance to a sound and sustainable track and to protect the development objectives set in Ghana Second Growth and Poverty Reduction Strategy (GPRS II) for the period 2006- 2009.

The GPRS II emphasises the centrality of private-led growth to reduce poverty, along with human development and governance efforts to promote equity. Specifically, EGPRC supports actions to restore budgetary discipline and tackle long-standing public sector and energy issues, while protecting the poor.


Mr Diwan said since mid-2009 Ghana's economy has shown strong signs of stabilisation while weathering the impact of the global financial crisis and, notwithstanding the large expenditure slippages in 2008, both the fiscal and current account deficits were significantly reduced in the course of 2009, under the impact of positive exogenous shocks and significant fiscal stabilisation efforts and achievements.


"The fiscal deficit (on cash basis) reached 9.7 per cent of Gross Domestic Product (GDP) in 2009 (against 14.5 per cent a year earlier) while the balance of payments' current account registered a 5.1 per cent of GDP deficit (against 18.7 per cent a year earlier).


He said since July 2009, the exchange rate has stabilised and even slightly appreciated against the US$ (the dollar had depreciated by 45 per cent in the previous 12 months).


Mr Diwan said: 93Consumer prices also broadly stabilised, growing at an annual pace of 6.7 per cent over the period June 2009 to April 2010. As such the year-on-year inflation target set forth by the Bank of Ghana for December 2009 96 14.6 per cent- was almost attained (15.9 per cent) and within the range agreed upon with the International Monetary Fund (IMF).


"By May 2010, six-month Treasury Bills were subscribed at 13.5 per cent, down from 28.4 per cent a year earlier," Mr Diwan said.