Ghana Controlling Spending as Decline in Oil Threatens Budget

  • Minister of Finance Terkper sees cedi depreciation tapering
  • Currency has dropped 14 percent this year against dollar

Ghana is taking steps to avoid missing its fiscal deficit target this year as falling oil prices erode revenue from crude sales.

“With the continuous fall in crude oil prices, the petroleum benchmark revenue may not be achieved,” Seth Terkper told reporters in Accra, the capital, on Thursday.

The government lowered its growth forecast for this year to the lowest level in two decades and said it would target a wider-than-expected fiscal gap because of falling oil prices and a slump in the currency. Ghana’s cedi has dropped 14 percent this year against the dollar, pushing inflation to 17.9 percent in July. Brent crude traded in London has fallen 51 percent in the past year.

Ghana produces about 100,000 barrels of oil a day from its offshore Jubilee field operated by London-based Tullow Oil Plc. The government is targeting a deficit of 7.3 percent of gross domestic product, wider than the initial estimate of 6.5 percent.