Ghana needs to renegotiate some resource contracts to increase tax revenues and give the cocoa-, gold- and oil-exporting nation more fiscal room to manoeuvre, Vice President Kwesi Amissah-Arthur said on Wednesday.
Ghana, which joined the club of African oil exporters in 2010, alarmed some investors with an increase in its fiscal deficit to more than 12 percent of gross domestic product (GDP) last year as public sector salary costs rose.
Amissah-Arthur told a mining conference there was a widely held view that Ghana needed to increase resource revenues.
“It is therefore necessary that we negotiate and in some cases renegotiate contracts to optimize revenues and to ensure fiscal space and responsiveness to windfalls,” he said.
Finance Minister Seth Terkper last month said the government would introduce new levies and hike tax rates to generate additional revenue to meet this year’s budget targets, which include paring the fiscal deficit to 9 percent.
The West Africa country scrapped fuel subsidies last month in a bid to reassure investors about government finances before issuing a second Eurobond of up to $1 billion in July.
Amissah-Arthur said a comprehensive review of the mining sector was underway, designed to ensure fairness and attract more investment.
As part of the review, the government will adjust stability clauses to make them more closely-linked to the economy, he said. Ghana has stability agreements, under which firms enjoy some tax relief, with AngloGold Ashanti and Newmont Gold.
Source: GhanaWeb
