Finance Minister Dr Cassiel Ato Forson has assured Ghanaians that the government will not contract additional loans to finance its proposed New Economy Programme, stating that the initiative will be funded through domestic revenue and savings from fiscal consolidation.
Dr Ato Forson disclosed that the government plans to allocate 1.5 per cent of Ghana’s Gross Domestic Product (GDP) annually towards the programme from 2027 to 2030 without increasing the country’s public debt.
He made the announcement during an engagement with students and members of the university community at the Kwame Nkrumah University of Science and Technology (KNUST), where he addressed concerns about the programme’s funding arrangements.
According to the Finance Minister, the funding will come from two major sources: 0.5 per cent of GDP from government revenue and a reduction in the primary surplus target from 1.5 per cent to 0.5 per cent of GDP.
He explained that the arrangement would create additional fiscal space for investment, potentially providing at least US$13 billion over the four-year implementation period.
Ato Forson Explains GoldBod’s Role in Government Revenue
The Finance Minister also clarified that the Ghana Gold Board (GoldBod) does not generate revenue directly for the Ministry of Finance or the government.
He explained that Ghana’s government revenue is mainly derived from direct taxes, indirect taxes and non-tax revenue.
Dr Ato Forson further reaffirmed the government’s commitment to responsible borrowing and debt sustainability, maintaining that Ghana remains focused on reducing public debt to 45 per cent of GDP by 2028.
Ghana Targets Public Debt Reduction Through Fiscal Consolidation
To demonstrate progress in debt management, the Finance Minister revealed that Ghana recorded a primary surplus of 2.5 per cent of GDP in 2025, with another surplus of 1.5 per cent projected for 2026.
He said the combined fiscal surpluses would contribute to reducing public debt by approximately 4 percentage points of GDP.
However, beginning in 2027, the government plans to moderate its debt reduction target to 0.5 per cent of GDP annually to create room for increased investment in the New Economy Programme.
Dr Ato Forson maintained that the funding strategy would allow the government to pursue economic transformation, stimulate job creation and support productive sectors while keeping Ghana’s public debt on a downward trajectory.
Source: newsthemegh.com