Gov't postpones 2023 mid-year budget review presentation; Rescheduled to July 31st

The presentation has been rescheduled to Monday, July 31, 2023. Initially slated for Tuesday, July 25, the mid-year budget review was further delayed from its announced date of Thursday, July 27.

The budget review is anticipated to unveil the government's fiscal roadmap for the remainder of the year, focusing on measures to ensure economic stability and growth.

Ghana is facing fiscal challenges, evident in a significant increase in public debt by a fifth in just four months. Contributing factors include the inclusion of short-term loans from the central bank to the state. As of the end of April, public debt, excluding state-owned enterprises obligations, reached GH¢569.3 billion ($49.7 billion).

The debt figure was adjusted to include the central bank's overdraft to the government, which was securitized in December 2022. Consequently, the debt figure as of December rose to 473.2 billion cedis after the adjustment, compared to the previous estimate of 434.6 billion cedis.

Despite the rising debt, obligations as a ratio of gross domestic product (GDP) declined to 71.1% in April from 77.5% in December.

To address the debt situation, Ghana is restructuring a significant portion of its debt under a $3 billion International Monetary Fund (IMF) program approved in May. This involves a domestic debt exchange and ongoing discussions with bilateral and Eurobond holders.

Investors are also facing reduced coupons as the restructuring of $1.5 billion domestic dollar bonds and cocoa bills commenced on July 14.

Overall, the rescheduled mid-year budget review comes at a crucial time for Ghana as it navigates fiscal challenges and aims to make its debt more sustainable under the IMF program. Ongoing debt restructuring efforts and discussions with investors are integral to addressing the country's financial situation.