President Akufo-Addo Redeems Another Campaign Pledge.
December 2018 will be remembered as a historic month in Ghana’s quest for sustained fiscal discipline and financial system stability. Historically, Ghana has persistently had a problem with politicians pursuing fiscal policy that is inconsistent with macroeconomic stability (especially during election years).
To tie the hands of politicians going forward, the President has caused to be passed in December, 2018, a Fiscal Responsibility Act which limits the budget deficit in any year to not to be more than 5% of GDP.
On 22nd December, 2018, President Akufo-Addo by Executive Instrument established a Fiscal Council to provide independent analytical advice on fiscal policy. It will be chaired by Dr. Paul Acquah, former Governor of the Bank of Ghana. Ghana becomes the first Country in Africa to establish a Fiscal Council.
In addition, the President by Executive Instrument also established a Financial Stability Council to enhance the stability and soundness of the financial system. It will comprise the Governor of the Bank of Ghana (Chairman), Deputy Governor, Deputy Minister of Finance, CEO of the National Insurance Commission, Director General of the Securities and Exchange Commission, CEO of the National Pensions Regulatory Commission, and CEO of the Ghana Deposit Protection Corporation.
Ghana also becomes the second country in sub-Saharan Africa to establish a Financial Stability Council, after Mauritius.