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The African Development Bank Group (AfDB) and the Ministry of Finance in Ghana have launched a US$7.4mn institutional support project to strengthen domestic revenue mobilisation
This follows the signing of grant and loan agreements and the first disbursement of project funds. It will facilitate prudent debt management, deepen financial sector reforms and support capital market development.
The funds will specifically provide technical assistance and capacity building to improve efficiency in non-tax revenue collection and bolster debt and cash management reforms. The project complements current efforts to strengthen domestic resource mobilisation in Ghana, following the challenges in revenue mobilisation due to supply disruptions caused by COVID-19 pandemic.
At the project launch, Emmanuel Fordjour, manager at the Resource Mobilisation and Economic Relations Division of the Finance Ministry, thanked the African Development Bank for supporting the government. He expressed the Ministry of Finance’s commitment to accelerating the project’s implementation.
The African Development Bank country manager for Ghana, Eyerusalem Fasika, emphasised the importance of the project to Ghana’s medium-term development objectives and the Finance Ministry’s 2018-2021 strategic plan. She noted that the project aligns with the Bank’s Country Strategy Paper (2019-2023) as it provides the foundation for additional fiscal space to support investments in infrastructure to bolster industrialisation, job creation and spur private sector activity and regional integration.
Ghana is classified as having a high risk of debt distress, according to the IMF’s recent Debt Sustainability Analysis. The project will help the country return to prudent debt levels through improved debt management capacity and a sustainable cash flow to smooth public spending.
The bank also welcomes the country’s ambition to become a regional financial services hub, hence the project is expected to support the establishment of an international financial services center in Accra.