More jobs coming as World Bank pumps $200m into economy
The World Bank on Wednesday approved a $200 million International Development Association (IDA) credit to support Ghana in strengthening its institutions, improving competitiveness for job creation, and maintaining social safety nets to protect the poor and vulnerable.
The Second Macroeconomic Stability for Competitiveness and Growth Development Policy Financing (DPF) operation will specifically support reforms by government to manage better subsidies and arrears particularly by State Owned Enterprises (SOEs) in the energy sector, which have contributed to weakening Ghana’s fiscal position and have adversely affected growth.
Over time, as fiscal outcomes become more predictable, confidence among both domestic and external investors will grow. This, in concert with better performance of the energy sector, will help improve Ghana’s business environment, making it more competitive to create more and better jobs, further reduce poverty, and help boost shared prosperity.
“As the economy improves and creates more and better jobs, there is also need to protect and promote livelihoods of the poor and the vulnerable segment of the population to help break intergenerational poverty,” said Henry Kerali, World Bank Country Director for Ghana.
“Building institutions for predictable fiscal outcomes and improving the business environment for the private sector are likely to remain priorities for the Government of Ghana as medium to long-term goals.”
The Second Macroeconomic operation is the last in a programmatic series of two single-tranche operations to support the implementation of Ghana’s Second Shared Growth and Development Agenda over the 2014-2017 period.
The operation complements the macroeconomic stabilization program supported under the IMF Extended Credit Facility. In addition, technical assistance to undertake reforms is being provided under the Ghana Economic Management Strengthening Technical Assistance Project supported by the World Bank.
“Recent commitment to entrench fiscal responsibility rules and establish a fiscal council to provide oversight on the implementation of such rules, are positive developments and the World Bank looks forward to supporting such reforms going forward,” said Errol George Graham, World Bank Program Leader and Lead Economist.
The reforms initiated in the energy-related SOE sector, including corporate governance reforms are critical to reducing contingent liability and improving service delivery.
This DPF operation is fully aligned with the World Bank Group Country Partnership Strategy and is consistent with the World Bank Twin Goals of boosting shared prosperity and ending extreme poverty.
The DPF operation is closely coordinated with other budget support operations from other development partners.
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