Ghana has not been downgraded from a middle-income country to lower-income status by the International Monetary Fund, former Finance Minister, Seth Terkper has stated.
“We’ve not been downgraded if you use the main criteria, which is per capita income which is calculated by the World Bank,” Mr. Terkper said on Morning Starr Tuesday.
He added, “If you are a middle-income country you must have a revenue of 17-18% income to GDP. At the moment we’re doing about 11%. We must equip GRA to perform and raise the revenue from the current 11% to at least 15-17%.”
The former Finance Minister’s comments come on the back reports that the country’s economic status has been downgraded from middle income to lower income by the International Monetary Fund (IMF).
The IMF has, however, denied the claim.
Many social media posts and news reports on Monday claimed that the IMF in its April 2021 Fiscal Monitor document downgraded Ghana’s economic classification to low-income status.
The classification of Ghana as a low-Income developing country in the IMF’s April 2021 Fiscal Monitoring document is not a downgrade as it has been so in most of the IMF’s previous report even dating back to April 2017.
Mr Terkper has also proposed the conversion of some boarding senior high schools under the Free SHS policy into community day schools in order to cut down costs on running them.
According to him, the current structure of the Free SHS policy places a heavy burden on the finances of the state and could potentially throw the economy out of balance.
“I’m proposing that we convert some of the boarding schools under free SHS into Community Day schools so we can cut down on the cost. Also, some of us who are well-to-do must understand that we must pay for the secondary education of our children. This what we must all do, it may not be politically correct but these are conversations that we must have,” he told Francis Abban on Morning Starr Tuesday.
He also noted the Ghana Revenue Authority must be well equipped to scale up on revenue collection.