The IMF concludes that the Presidents home-grown policies have not yielded because of lack of implementation discipline. So this is what the Fund suggests, A more ambitious and front loaded fiscal consolidation is needed to help place public debt on a sustainable path, and to allow monetary policy to be more effective in bringing down inflation, including by strictly limiting budget deficit financing by the Bank of Ghana. Front loaded adjustment should be realized through reductions in Ghana’s comparatively high public sector wage costs, the elimination of costly and untargeted subsidies for energy and petroleum products, and a better prioritization of capital spending. On the revenue side, reduction of tax exemptions and strengthened revenue administration through a better targeting of large taxpayers appear necessary. At the same time, it will be important to expand well targeted social protection programs to mitigate the potential impact of fiscal consolidation measures on the most vulnerable groups of the population. In the medium term, structural reforms and institutional changes will be key to sustainable fiscal consolidation and lasting expenditure discipline. “Discussions on a possible program that could be supported by the IMF will continue in Washington during the Annual Meetings. ”
Posted on: Fri, 26 Sep 2014 19:48:04 +0000
Trending Topics
Recently Viewed Topics
© 2015