Parliament grants $2.75B state funding to March 2017

October 21, 2016 6:06 AM

President John Mahama faces a tough re-election battle against opposition leader Nana Akufo-Addo

Minister of Finance and Economic Planning of Ghana Seth Terkper speaks at a forum on financial development at the 2016 IMF World Bank Spring Meeting in Washington April 17, 2016.

Ghana's parliament on Thursday approved state spending of almost 11 billion cedis ($2.75 billion) through the first quarter of 2017 in advance of an annual budget to be delivered after elections in December.

The budget is normally presented in November but given the presidential and parliamentary election on Dec. 7 it will instead be tabled by next March, Finance Minister Seth Terkper told reporters.

"What we are doing is an elaborate cash flow. Our approach is to meet only critical expenditures in the first quarter," Terkper said, noting that the amount passed represented a figure much lower than 25 percent of full-year expenditure.

A bill of 3.9 billion cedis for civil service salaries constituted the largest slice of the $2.75 billion total, according to the document.

Ghana is one of Africa's most stable democracies and President John Mahama faces a tough re-election battle against opposition leader Nana Akufo-Addo. Both candidates were on the campaign trail on Thursday and missed the parliamentary debate.

Terkper said the government expects robust growth in 2017 driven in part by an increase in oil and gas production as well as a further reduction in the debt to GDP ratio that stands at about 68 percent.

Ghana - Africa's second largest gold producer and an exporter of oil and cocoa - forecasts GDP to rise to above 8 percent in 2017 after it slowed sharply since Mahama took power in 2012, in part because of a fall in oil and gold prices.

The government's economic management faces intense scrutiny under a $918-million International Monetary Fund programme that began last year and is designed to reduce inflation and the budget deficit and stabilise the cedi currency.

Opposition deputies said they would not oppose the spending plan, but stressed in parliament that revenue had fallen and spending and debt had increased since Mahama took power.

($1 = 3.9700 Ghana cedis)