The EU welcomes the recent conclusion and implementation of a 3-year Extended Credit Facility programme with the IMF. This programme will serve to address the macroeconomic imbalances which meant that the European Commission was unable to disburse budget support to Ghana at the end of 2013. It includes a comprehensive reform package on the two aspects which were the main sources of concern for the EU: fiscal deficit and debt sustainability.
In addition, we welcome the adoption and publication in March 2015 of the Government’s Payroll Action Plan to address payroll irregularities. In this regard we are also satisfied to note that the IMF programme includes a strong Public Financial Management component and integrates important benchmarks of this Action Plan.
I am therefore pleased to announce the decision by the European Commission to resume budget support disbursements to Ghana. The EU will release in total EUR 161.38 Million of budget support to the Government of Ghana in the coming weeks. This support is aimed at 4 areas:
- EUR 105.63 Million to support implementation of the Ghana Shared Growth and Development Agenda II, Ghana’s national development plan for 2014-2017.
- EUR 31.25 Million to support the Ministry of Health in implementing the MDG-Acceleration Framework and country action plan to reduce maternal mortality in Ghana and achieve MDG 5.
- EUR 17.5 Million to support the decentralisation reform processaimed at improving service delivery at local level.
- EUR 7 Million to support the preparation and implementation ofpolicy reforms in the Environment and Natural Resources sector, promoting, amongst others, effective forest law enforcement and the development and implementation of the National Climate Change Strategy.
The EU stands ready to support Ghana in pursuing its development agenda and particularly in the implementation of the challenging structural reforms ahead. The sound implementation of the IMF programme will be essential to restore macro-economic stability with a view to creating an enabling framework for development, investment and job creation. A comprehensive Public Financial Management reform, including all necessary actions to combat any irregularities and mismanagement of public payroll, will also be fundamental. The EU will continue to closely monitor progress in these two areas.