It has now become apparent that the maiden budget of the new government for the 2025 fiscal year is set to be presented to parliament by the Finance Minister as demanded by law on March 11, 2025. This means in less than 30 days Ghana’s economic direction under President John Dramani Mahama will be laid bare to the entire world.
Given the government’s reset agenda, everyone has an expectation. I believe you do. Traders, teachers, pensioners, exporters, importers, head potters, and even the unemployed among others all have high expectations.
Irrespective of your expectations depending on your areas of interest, there are some critical areas and policies that are expected. Given the current economic situation, campaign promises, and the utterances of officials of the government, The High Street Journal has compiled some major economic policies that are highly likely to be addressed by the Finance Minister, Dr. Cassiel Ato Baah Forson
- Fiscal Consolidation & Debt Management
Ghana’s economy is crumbling under a high debt overhang. Public debt stock now stands at US$47.9 Billion equivalent to GHC736.9 Billion representing 72.2% of GDP. Already there is interest payment due to the high debt accumulation. It is therefore anticipated that the government will announce measures to reduce the public debt stock and minimize budget deficits. Measures to wasteful government spending are also highly anticipated. - Tax Reforms and Revenue Mobilization
Minister for Finance at his vetting committed to increasing tax-to-GDP to about 18%. Meanwhile, the same government has promised tax cuts which have become very controversial. The fate of e-levy, betting tax, COVID-19 levy, and emission levy will be determined in this budget. How the government will make up for the revenue shortfall will also be known. Will there be adjustments to Value Added Tax (VAT)? Measures to expand the tax base and improve tax compliance and evasion. - Cost of Living and Inflation Control Measures
The majority of Ghanaians are feeling the hit in their pockets and their budgets are getting drained day-by-day due to soaring inflation. The cost of living is rising by the day and the low-income earners are taking the most hit. It is the expectation of all Ghanaians that there will be policies to address inflation, especially food prices. Policies to intervene and stabilize the Ghana cedi against foreign currencies are highly anticipated.
4 Employment and Job Creation
For the unemployed and the under-employed, this is their major expectation. How is the government going to maneuver its way amidst the tight fiscal space and economic challenges to introduce programs to create sustainable jobs for the youth? Interventions to support entrepreneurship and start-ups. Of course, the 24-hour economy policy is expected here. - Energy Sector Reforms
One thing Ghanaians are very particular about is the light kept on. Large businesses and SMEs that depend on electricity will also glued anticipating what the plan of the government is for the energy sector. Already we have glimpses of the plan of ECG. More measures will be expected to address Ghana’s power sector challenges. The energy sector debts are huge. Strategies are highly anticipated on how the government will deal with those debts. - Social Intervention Policies
Although there may not be enough fiscal space for the government to introduce a new social intervention policy, the fate and the direction of the existing ones are highly anticipated. Existing interventions such as the National Health Insurance Scheme (NHIS), Free SHS, LEAP others will be prominently featured. Will they be reviewed or maintained in their current form? All will be laid bare on March 11, in Parliament. - Galamsey
It is very clear that the budget cannot gloss over the issue of illegal mining widely known as galamsey which has become an existential threat to the country. Policies to formalize the small-scale mining sector to prevent illegal activities are highly anticipated. - Agriculture and Food Security
It is highly anticipated that there will be a review of subsidies for farming implements. How the government will promote mass production of food throughout the year to curb food inflation. COCOBOD, the World Bank says has become a threat to the fiscal stability of the country therefore policies are expected to transform the operations and address the financial difficulties.
Other areas highly expected to be captured in the budget include Industrialization and private sector growth, digitization, international trade, and investment policies among others.
Overall, the 2025 budget presentation will be a critical indicator of the new government’s approach to addressing Ghana’s economic challenges and fulfilling its campaign promises.
