Govt is initiating moves to prevent excessive borrowing – Finance Minister

3 News

Mon 24th Mar, 2025 06:56

The Finance Minister Dr Cassiel Ato Forson has revealed plans to submit a fiscal responsibility rule to Parliament, which will set a debt ceiling that the Ministry of Finance cannot exceed.

This, he said, will help prevent excessive borrowing and ensure long-term financial stability.

As part of this commitment, the Minister announced massive investment cuts and a reset of goods and services expenditure to 2023 levels. The government is also targeting a primary surplus of 1.5%, a crucial step toward stabilizing the economy.

He said this while speaking at a meeting with over 22 Managing Directors of banks last week.

The meeting was attended by Bank of Ghana Governor, Dr. Johnson Asiama, and his deputy. Dr. Asiama welcomed the Minister’s assurances, describing them as a positive signal ahead of his first Monetary Policy Committee (MPC) meeting this week.

READ ALSO: I’ve never seen a budget that meets the people’s needs and aspirations — Sammy Gyamfi

Also present was Mr. Kwamina Asomaning, President of the Ghana Association of Banks (GAB) and CEO of Stanbic Bank Ghana. He commended the Minister for a well-received budget and pledged the banking sector’s support in deepening financial inclusion and strengthening capital markets. He also called for continued dialogue between the government and financial institutions as the country works toward economic recovery.

Dr. Forson’s message was clear: Ghana is committed to responsible fiscal management. The government is focused on stability, collaboration, and prudent financial decisions to avoid repeating past economic challenges.

“We need each other,” he told the bank CEOs. “We want you as partners in our development. We will not be reckless.”

Earlier, Professional services firm, Deloitte said that despite the positive signs from 2024, Ghana’s economy will require structural adjustments to put the country on the path to sustainable economic growth and debt levels.

To set the agenda towards building the desired economy, Deloitte noted that the government, in its 2025 Budget Statement, has proposed a number of domestic revenue mobilization measures and expenditure rationalization strategies aimed at stabilizing the economy and improving macroeconomic indicators.

A key highlight of the 2025 Budget Statement is the abolishment of a number of taxes and promised reform of the Value Added Tax (VAT) regime.

“The expected VAT reform would be much welcomed by the business community, and we look forward for this to be initiated and completed in this calendar year.

“The business community is also looking forward to “realignment” of import duties, especially on production inputs, to enable it grow and provide the necessary jobs in the economy,” Deloitte said in its analysis of the 2025 budget statement.

It added “We await specific details on the 24-Hour economy, using government procurement to spur local growth and the “Big Push” strategic infrastructural development programme, which aims to allocate US$10 billion to fund infrastructural development.”

Deloitte also noted that the Ghanaian economy has undoubtedly experienced significant economic headwinds in recent years culminating from an International Monetary Fund (IMF) Extended Credit Facility (ECF) programme, aimed at restoring macroeconomic stability and ensuring debt sustainability.

READ ALSO: 5.7% expansion shows economy was doing well before NDC took over – Gideon Boako

Regarding specific commitments by the government, Deloitte said that they were waiting for specific details on the 24-Hour economy policy idea by the Mahama administration.

He announced this on Tuesday, 11th March, during the presentation of the 2025 Budget Statement and economic policy to Parliament.

“The Mahama-led NDC government is committed to the pursuit of the 24-hour economy policy,” he stated.

“Ghana already has the necessary legal framework for which we look forward to seeing tightening of fiscal responsibility rules to ensure debt sustainability. The current debt levels within the energy sector, especially in electricity generation and distribution, need to be resolved with the proposed comprehensive and concerted push.

“At Deloitte, we are guided by our purpose of making an impact that matters, and in these times, we deliver on this purpose ensuring that our clients, the public and society are abreast of the economic happenings and their effects.

The post Govt is initiating moves to prevent excessive borrowing – Finance Minister first appeared on 3News.