Ghana’s Economic Recovery Requires Structural Adjustments, Says Deloitte

Deloitte asserts that Ghana’s economy, while showing recovery signs in 2024, requires structural adjustments to ensure sustainable growth and effective debt management. The proposed 2025 Budget includes tax reforms and a focus on domestic revenue mobilization. Key initiatives expected include VAT reform, the 24-Hour economy, and a US$10 billion infrastructure plan, aiming to stabilize the economy and improve macroeconomic indicators.

In a recent analysis, Deloitte emphasized that while Ghana’s economy shows signs of recovery in 2024, it necessitates structural adjustments to achieve sustainable growth and manage debt levels effectively. The government’s proposed measures in the 2025 Budget Statement focus on domestic revenue mobilization and expenditure rationalization to stabilize the economy and improve overall macroeconomic indicators.

A significant aspect of the 2025 Budget includes the abolishment of certain taxes and the anticipated reform of the Value Added Tax (VAT) system. Deloitte expressed optimism regarding the VAT reform, asserting, “The expected VAT reform would be much welcomed by the business community, and we look forward to this being initiated and completed in this calendar year.”

Deloitte also highlighted the business community’s expectation for the realignment of import duties on production inputs, which is essential for economic growth and job creation. Additionally, they are awaiting specific details on the government’s proposed 24-Hour economy initiative and the “Big Push” infrastructural development program, which aims to allocate US$10 billion for infrastructure projects.

The firm acknowledged the significant economic challenges faced by Ghana in recent years, exacerbated by an International Monetary Fund (IMF) Extended Credit Facility (ECF) program aimed at restoring macroeconomic stability and ensuring sustainable debt levels. Deloitte is keenly observing the government’s commitment to the 24-Hour economy policy, introduced by the Mahama administration, which promises potential job creation and sustainable economic growth.

Furthermore, Deloitte noted the existing legal framework in Ghana that supports fiscal responsibility and emphasized the need to address the current debt levels in the energy sector. The firm remains committed to delivering insights that matter during these crucial economic times, reflecting their purpose to keep clients and the public informed about economic trends and impacts.

In conclusion, Deloitte’s analysis underscores the importance of structural adjustments in Ghana’s economy despite positive recovery signs. The proposed reforms in the 2025 Budget, particularly regarding tax reforms and infrastructural investments, are critical for achieving sustainable growth. Ongoing observation of government initiatives like the 24-Hour economy will be essential as they seek to address economic challenges and foster job creation.

Original Source: 3news.com