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The Mahama administration has implemented a series of measures to reduce government spending, which, according to Finance Minister Dr. Cassiel Ato Forson, has supported the Bank of Ghana in controlling inflation.
Dr. Forson made the remarks during the Ghana-UK Investment Summit in London on Monday, June 1.
He explained that over the past decade, public debt has been rising due not only to government expenditure but also due to a phenomenon known as stop-flow adjustment—where state-owned enterprises transfer their debt to the central government, accounting for about 2.5 percent of GDP. To address this, the government introduced commitment authorisation, requiring approval for any expenditure or financial commitments by state-owned enterprises.
“By cutting expenditure, we have effectively assisted the central bank in controlling inflation,” he said.
Dr. Forson also highlighted the role of the GoldBod, a government initiative aimed at curbing gold smuggling and capturing more value from the gold sector.
“Previously, significant amounts of gold were leaving the country illegally, depriving Ghana of economic benefits. With the introduction of GoldBod, we were able to purchase US$14 billion worth of gold in one year, helping the central bank strengthen its reserves. This year, we expect to acquire at least US$20 billion in gold. Additionally, the sliding scale system allows us to capture economic rent from gold more effectively,” he added.
Story by Efua Nessa