Gov’t won’t borrow to finance New Economy Programme – Ato Forson

Finance Minister Dr Cassiel Ato Forson has assured that the government will not contract additional loans to finance its proposed New Economy Programme, saying the initiative will be funded through domestic revenue and savings created by fiscal consolidation.

He said the government intends to commit 1.5 per cent of Gross Domestic Product (GDP) annually to the programme between 2027 and 2030, without increasing the country’s public debt.

Dr Ato Forson gave the assurance during an interactive engagement with students and members of the university community at the Kwame Nkrumah University of Science and Technology (KNUST), where he addressed concerns about the programme’s funding arrangements.

The Finance Minister identified two main sources of funding for the initiative.

According to him, the government plans to allocate 0.5 per cent of GDP from its revenue and create additional fiscal space by reducing the primary surplus target from 1.5 per cent to 0.5 per cent of GDP.

He explained that the two measures would provide the resources needed to support investment under the programme without resorting to new borrowing.

The proposed allocation could amount to at least US$13 billion over the four-year period, covering 2027 to 2030.

Dr Ato Forson also clarified that the Ghana Gold Board (GoldBod) does not generate revenue for the Ministry of Finance or directly contribute to government revenue in the manner of conventional tax-collecting institutions.

He explained that the government's finances are primarily supported by direct taxes, indirect taxes and non-tax revenue.

The clarification comes amid public discussions about GoldBod's operations and its contribution to Ghana's economic and fiscal position.

The Finance Minister further reaffirmed the government's commitment to debt sustainability, including its target of reducing public debt to 45 per cent of GDP by 2028.

He cited improvements in the country's primary balance as evidence of progress towards fiscal consolidation.

According to him, Ghana recorded a primary surplus equivalent to 2.5 per cent of GDP in 2025, while a further surplus of 1.5 per cent is expected in 2026.

He said the two surpluses would collectively contribute to a debt reduction equivalent to approximately four per cent of GDP.

However, from 2027, the government intends to moderate the pace of debt reduction to 0.5 per cent of GDP annually. This would create additional fiscal space for investments under the New Economy Programme while maintaining the government's broader debt sustainability commitments.