Positive results are starting to flow from Ghana’s fiscal consolidation plan that includes
an aid deal with the International Monetary Fund and a decision by the European Union to renew budget support, President John Mahama said on Friday.
Mahama cited a slowdown in the increase in the inflation rate as an example of improvement and said the currency, which has
fallen to a record low against the dollar, was being hurt partly by speculation.
“We are beginning to see the start of fiscal consolidation,” Mahama told reporters. He said he intended to run for a second four-year term in 2016 if selected by the ruling National Democratic Congress to face opposition leader Nana Akufo-Addo.
Since Mahama came to power in 2012, the government has faced a fiscal crisis that has seen a slowdown in growth in an economy that had expanded quickly on exports of gold, cocoa and oil.
Inflation rose in May to 16.9 percent from 16.8 percent the previous month, while the currency has fallen at least 22 percent this year on top of a 31 percent decline last year. What Mahama called a “tight economy” leaves the government open to opposition criticism compounded by power shortages that have angered voters and sapped business confidence.
In addition, 150 people died last week in an explosion at a gas station and floods caused by seasonal rains that exposed the capital’s inadequate drains and infrastructure problems.