In its preliminary impact assessment, Ghana anticipates incurring a total cost of 9.5 billion Ghana cedis (1.64 billion U.S dollars) as a result of the outbreak of the COVID-19 pandemic.
The Minister for Finance Kenneth Ofori-Atta, who disclosed this to parliament here on Monday, said the cost would arise out of anticipated shortfalls in petroleum revenue, import duties, other tax revenues, the cost of the preparedness plan, and the cost of coronavirus alleviation program.
“The government will register a shortfall in crude oil receipts amounting to 5.67 billion cedis (984 million dollars),” the minister told parliament.
Since the onset of the pandemic, crude oil prices have fallen from 63.21 dollars per barrel COVID-19 to 22.9 dollars per barrel.
To cater to the contingency financial needs of the COVID-19 response, the minister proposed to parliament to amend the country’s petroleum revenue management act (PRMA) to allow for the withdrawal of funds from both the petroleum heritage funds and the Ghana stabilization fund.
The minister said Ghana also expected some financing assistance from the World Bank and the International Monetary Fund (IMF) while adjusting expenditure on goods and services as well as capital expenditure to create fiscal space for the response.
Ofori-atta said, “The two main areas driving the bulk of economic activities in Ghana, namely, the Greater Accra and Greater Kumasi areas, are also the very places mainly hit by the virus.”
He, therefore, anticipated that the two weeks lock-down of these two cities would worsen the impact of the pandemic outbreak on the national economy.
The central bank had cut projected economic growth from 6.8 percent to about 2.6 percent should the pandemic linger. Enditem