Mr Ken Ofori-Atta, Minister of Finance, on Thursday indicated that the global economy is expected to witness some improvement in growth in 2017 in the medium term after a lackluster performance in 2016. He said the January 2017 update of the International Monitory Fund's World Economic Outlook (WEO) projects a global growth of 3.1 per cent in 2016; this is expected to improve marginally to 3.4 per cent in 2017 and further to 3.6 in 2018.
Delivering the 2017 maiden budget of the ruling New Patriotic Party government in Parliament, the Finance Minister said emerging markets and developing economies growth was expected to remain unchanged at 4.1 per cent in 2016, and was projected to recover to 4.5 per cent in 2017 and further to 4.8 per cent according to the WEO.
He said the downside risks to the global outlook, according to WEO, include increased restrictions on global trade and migration and its negative impact on productivity.He noted that the high corporate debt, declining profitability, weak bank balances, and thin policy buffers in emerging market economies may lead to capital flow reversals and depreciation of the local currency.
Mr Ofori-Atta said oil prices have picked up in recent weeks resulting mainly from an agreement among major producing countries to reduce supply, saying crude oil prices were expected to average $55 per barrel in 2017, about 28 percent increase over the 2016 levels.“Gold prices are expected to decline from an average of US$1,249 per fine ounce in 2016 to US$1,219 in 2017 due largely to an expected strengthening of the US dollar. According to the Commodity Markets Outlook by the World Bank, Cocoa price is projected to average about US$2,940 per tonne in 2017 up from US$2,850 in 2016.”
He noted that Ghana joined nine other member states to implement the ECOWAS Common External Tariff (CET) effective February 1, 2016 considered as a major platform for the establishment of Customs Union that will facilitate free trade and advance greater economic integration within the region.Mr Ofori-Atta said the tariff was expected to help address problems such as cross- border smuggling and dumping in the sub-region, adding that the Ministry of Finance was currently monitoring and evaluating the impact of the new regime on various sectors of the economy.
He assured that government would work towards diversifying the economy to address the risk of commodity price volatility. “We will add significant value to our exports and support local manufacturing of imported goods, which can be produced locally in partnership with the private sector.”
<<Print>>