President Nana Addo Dankwa Akufo-Addo on Tuesday said the country lost more than GH¢13.5 billion in revenue in 2020 because of the economic shocks induced by the Covid-19 pandemic.
In his state of the nation address to Parliament, the President said with additional expenditures, related to stemming the tide of COVID-19, estimated at GH¢11.8 billion, the combined effect of the pandemic amounted to GH¢25.3 billion or 6.6 per cent of Gross Domestic Product.
He said the resultant fiscal deficit for 2020 was, thus, revised from 4.7 per cent of GDP to 11.4 per cent of GDP to reflect the impact of the pandemic.
The President said the fiscal responsibility rule of keeping a deficit within a threshold of five per cent of GDP and a positive primary balance for every year was suspended in 2020 to enable fiscal operations to accommodate the impact of the pandemic.
However, President Akufo-Addo said the government expected a boost in economic activities, which were already picking up, following the ongoing vaccination exercise and the easing of restrictions instituted to curb the effects of the disease for rapid economic growth.
“We expect Gross Domestic Product growth to rebound strongly this year to nearly five per cent, above the IMF’s 2021 January projection of 3.2 per cent growth for Sub-Saharan Africa for 2021,” President Akufo-Addo said.
President Akufo-Addo said the establishment of the National Development Bank, under the Ghana CARES programme, would provide support to Ghanaian businesses.
He said the medium-term outlook, supported by the implementation of the Ghana CARES Programme, was bright and expressed confidence that, together, “we will emerge from the COVID-19 pandemic with a stronger and more resilient economy.”