‘Is deficit financing back?’ - Terkper criticises 53% BoG funding of 2020 budget

Former Finance Minister, Seth Terkper, has raised concerns about what he says is the recent aggressive fiscal stance taken by the Bank of Ghana in the wake of the COVID-19 pandemic.

Citing the central bank’s Monetary Policy Committee (MPC) statement released in May this year, the former Minister said it was clear that the BoG has significantly shifted its past conservative fiscal stance to an aggressive one.

In an article released on Thursday, the Minister cites what he says are anomalies in the central bank’s support and commitment to the government.

He said a total of GH¢15.877 billion fiscal support that has been earmarked for government, some of which have already been released, works out to over 53% of the fiscal balance of GH¢18.888 billion in the 2020 Budget.

“Given (a) absence of Supplementary Budget; and (b) RCF, other loans and Stabilisation Fund drawdown that appear to cover the COVID-19 needs, BOG seems to take major decisions on fiscal management that belong to only Parliament,” he said.

He said the deliberate blurring of the line between fiscal gaps occasioned by COVID-19 and those inherent in the 2020 Budget remains a source of concern for observers of Ghana’s fiscal scene.

Read the full article below.