Deputy Energy Minister
The 2024 Quarterly Report by Databank Research highlights concerns about election-related spending potentially jeopardizing Ghana's fiscal stability. The government's push for increased capital expenditure in 2024 may pose challenges, as there's a risk of exceeding budgetary allocations during an election year. This could lead to inflationary pressures and hamper efforts to control inflation.
Additionally, the report notes that geopolitical tensions, such as the ongoing Russia-Ukraine conflict and rising tensions in the Middle East, could result in higher energy prices. This, in turn, may impact domestic prices and utility tariffs. Uncertainties surrounding geopolitical developments, coupled with OPEC+ production, may further contribute to energy price hikes.
Moreover, the introduction of new taxes, including a 15% VAT on electricity for residential consumers above a certain threshold and a proposed emission tax, could add to inflationary pressures, particularly affecting utilities and transportation.
The report also cautions that escalating geopolitical tensions could worsen Ghana's trade balance by driving up commodity prices, leading to a higher import bill.
In summary, the report emphasizes the risks associated with election-related spending, geopolitical uncertainties, and new taxes, underscoring the importance of careful fiscal management and monitoring of external factors affecting Ghana's economy.
Source: cometodaddy.xyz
