Business in Ghana

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Posts Tagged ‘Ghana Budget’

IMF Might Need Some Answers. GNPC, GNGC, ENI and Due Dilligence

Posted by Business in Ghana on December 14, 2014

By Sydney Casely-Hayford

The news that Ghana’s Parliament approved the deal on the oil and gas project with ENI of Italy could raise important questions related to the Country’s program with the IMF.

There are implications for the budget, even as the price of crude continues to dip below the numbers used to estimate oil revenues to fund the Budget and other sectors, especially social safety nets might be compromised.

Whether subsuming GNGC into GNPC will affect the share of carried and participated interest of GNPC in its contract with ENI and whether there will be an impact on public and publicly guaranteed external debt is a big question.

Parliament already did the unthinkable and passed the $8billion contract with ENI speedily as it does when under pressure from Government to shore immediate cash demands.

The IMF program is struggling to finality, principally on a few key issues. One, the total value of Government debt is still open to debate and whether the composite debt must include liabilities of certain key parastatals such as VRA, GNPC and TOR must still be of concern. As also the debt of key Municipalities and Metropolitan Assemblies.

Two, the projected revenues are a problem with periodic budgets consistently below target and the payroll envelope is still threatening to engulf revenues.

As Parliament ducked the minority call for a stay in loan approval pending the $700million facility in court re: GNPC, the decision begged the question whether anyone had taken a closer look at ENI on the world scope. Read the rest of this entry »

Posted in Oil and Gas, Sydney Casely-Hayford | Tagged: , , , , , , , , , , , , , | Leave a Comment »

Political Debt, Are We Budgeting Enough?

Posted by Business in Ghana on November 6, 2011

By Sydney Casely-Hayford,

This year our budget must center on whether we can raise sufficient revenue to cover our full expenditures and not rely on donor support to shore up our politically generated deficit gap.  In finance parlance, we must cut the deficit budgeting this time round and look to growth measures and increase taxes to meet our expenditures.  It means tackling the tax base confidently and that should include the informal sector.

In the 2011 budget we planned some bold measures to ensure growth and revenue mobilization and throughout the year Government has announced better than planned revenues.  It has not made, as much noise about the expenditure overruns and not all the Single Spine implementation is complete.  The big one, Teachers and second largest Health are yet to be included.

In the 2011 budget we estimated revenue of ghc10.6billion.  In August 2011 it was supplemented by another ghc1.4billion, making total expected budget revenue ghc12billion.  Expenditure increased from ghc12.6billion initially and supplementary was ghc900million.  Our overspend (budget gap) is ghc1.5billion, which we couch as infrastructure needs, but it really is not. Read the rest of this entry »

Posted in Financial Services, Sydney Casely-Hayford | Tagged: , , | 1 Comment »