Finance Minister Dr. Mohammed Amin Adam has announced the government’s plan to establish an independent fiscal council aimed at preventing excessive borrowing and ensuring that Ghana remains within its financial limits.
This significant initiative is viewed as a key step towards enhancing fiscal responsibility and stabilizing Ghana’s economic outlook, particularly in light of the ongoing domestic debt crisis.
During a side interview at the 2024 Annual Meetings of the International Monetary Fund (IMF) and the World Bank Group on Wednesday, October 23, Dr. Amin Adam highlighted the importance of this initiative in maintaining sustainable debt levels and avoiding a recurrence of Ghana’s recent debt challenges.
He explained that the proposed fiscal council would be an autonomous body responsible for monitoring government borrowing practices and enforcing compliance with newly established debt limits.
The Finance Minister noted that the fiscal council is intended to function independently, without direct control from the government. Its primary role will be to ensure adherence to fiscal rules, particularly concerning borrowing and debt repayment.
“The domestic debt we did was a very painful exercise because people did not expect that. So to have taken the people of Ghana through this painful exercise has meant that they had to sacrifice beyond what many people could do. And because of that, they are demanding fiscal discipline, they are demanding fiscal stability, and that is why it will be very difficult to go back to the era of unsustainable debt.
“The second measure we are putting in place is the implementation of far-reaching structural reforms, you know, to build our resilience. And one of the structural reforms relates to the existing fiscal responsibility legislation to impose debt limits on ourselves.
“And we are also putting in place a fiscal council that will ensure compliance with the fiscal rules. The fiscal council is supposed to be an independent council which will, outside the government, monitor our progress in terms of debt management, in terms of how much we borrow, how we repay, to ensure that we do not go beyond the limit that we are imposing on ourselves.”
