Par 215m dollar lon

Feb 2011
Story: Emmanuel Adu-Gyamerah
PARLIAMENT yesterday approved a $215 million development financing agreement between the government and the International Development Association (IDA) for the seventh Poverty Reduction Support Credit (PRSC-7).
The credit is to support government’s efforts at enhancing budgetary discipline and tackling long-standing public sector and energy issues, protecting the poor and preparing for the oil era.
It is designed to bring the fiscal deficit of GDP ratios to sustainable levels in 2011.
The Ghana Shared Growth and Development Agenda (GSGDA) and the Ghana Aid Policy and Strategy for the period 2011-2015 reiterate the need for continued Official Development Assistance (ODA) and budget support.
According to the report of the Finance Committee of Parliament, signed by its Chairman, Mr James Klutse Avedzi, since the flow of oil revenue could prompt the nation’s development partners to reduce their ODA support to Ghana, the government was of the view that continued support would be needed in the first few years of oil production to provide additional funds to supplement oil and other revenues.
A Deputy Minister of Finance and Economic Planning, Mr Seth Tekpeh, moved the motion for the approval of the loan and he was seconded by Mr Avedzi.
The committee, in its report, observed that the entire credit would be withdrawn in a single tranche and that all tranche release conditions had been met by the government.
It added that the PRSC-7 facility would contribute to increased productivity, food security, accelerated economic growth and reduction in poverty.
In a related development, the Japanese government has made available for immediate disbursement an equivalent of $4.1 million to support Ghana’s budget for the 2011 financial year, reports Samuel Doe Ablordeppey.
All documentary and legal arrangements have been concluded and Ghana only needs to provide bank account details for the disbursing agency, the Japan International Co-operation Agency (JICA), for the funds to be transferred in about a month’s time.
The grant is part of a Multi-Donor Budgetary Support (MDBS), a harmonised framework by which 11 of the country’s development partners contribute varying amounts of grants and concessionary credit to finance Ghana’s strategic objectives and priorities set out in the medium-term development plan, the GSGDA 2011-2013.
The Minister of Foreign Affairs and Regional Integration, Alhaji Mohammed Mumuni, who signed the grant on behalf of Ghana, said the assistance demonstrated the solidarity and sustained support of the government and people of Japan towards the realisation of Ghana’s vision of attaining a better Ghana.
“This is yet another manifestation of the cordial bilateral relations that happily exist between the governments and the peoples of Ghana and Japan,” he said.
He announced that discussions were underway for Japan to provide another $2.4 million to support Ghana’s health sector programme for this year, stressing that that amply showed how committed Japan was to the progress and prosperity of Ghana.
The Foreign Minister recalled that last year Japan supported Ghana with $31.2 million and thanked the people of Japan for their continued generosity and assistance.
The Japanese Ambassador to Ghana, Mr Keiichi Katakami, who initialled the grant agreement on behalf of his country, said the facility would go to support the execution of Ghana’s medium-term development blueprint which spans 2011 to 2013.
Japan joined the MDBS framework in 2008 and this grant marks its fourth for the country after Ghana reached the completion point of the Heavily Indebted Poor Countries (HIPC) initiative.
“I strongly believe that Japan’s contribution to the MDBS will assist the government of Ghana to accelerate its implementation of the national development agenda, which includes the Millennium Development Goals (MDGs), especially in the year of action,” Mr Katakami stated.