Ken Ofori-Atta - Finance Minister
The Finance Minister, Ken Ofori-Atta, has announced a new initiative to reinforce the economy called the COVID-19 Alleviation and Revitalization of Enterprise Support Programme.
This three-year plan is also known as the Ghana Cares programme. According to the Finance Minister, it will take about three years for the Ghanaian economy to fully recover from the impact of COVID-19.
Speaking on the floor of Parliament on Thursday, May 28, 2020, the Finance Minister indicated that the programme will ensure the sustained growth of the economy.
“The Ministry of Finance is developing a three-year COVID-19 alleviation and revitalization of enterprise support programme –the Ghana Cares programme–to help revitalize the economy.”
“We are confident that this programme will help us stabilize and revitalize the economy,” Mr. Ofori-Atta said.
The pandemic has brought three years of economic growth of at least 6 per cent to a sudden halt. While the government anticipates that growth could slow to 1.5 per cent, the least ever to be recorded in 37 years.
In a bid to cushion Ghana’s economy as a result of the impact of COVID-19, the government has, among other things, launched a GH¢1 billion Coronavirus Alleviation Programme Business Support Scheme. This is being provided by the government and selected participating banks to micro, small and medium-scale businesses around the country.
The government has indicated that the cumulative effect of the pandemic is expected to cost Ghana GH¢9.505 billion.
Out of the GHS1 billion earmarked for Coronavirus Alleviation Programme Business Support Scheme, GH¢600 million will be disbursed as soft loans to micro, small and medium scale businesses with a two-year repayment plan and paid at a 3 per cent interest rate.
The government is also leaning on an IMF Rapid Credit Facility of US$1 billion, World Bank Development Policy Operation (DPO) of US$350 million and the Stabilisation Fund of $ 219 million.
The GHs5.5 billion from BoG
The Finance Minister, Ken Ofori-Atta says an advance GH¢5.5 billion from the Bank of Ghana has been given to the government to meet its financial obligations. The amount forms part of a BoG’s GH¢10 billion support to the government as a means on reducing the economic impact caused by the coronavirus on the economy.
The GHs 5.5 billion first instalment of the bond was released on May 15, 2020. By this, the Bank of Ghana has set aside a Memorandum of Understanding (MoU) with the International Monetary Fund (IMF) which bars it from financing the government’s budget which had been the case in previous years.
The additional GHs 4.5 billion cedis will be provided through the purchase of government assets.