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QUESTION ONE Corona Virus Disease Pandemic (COVID-19) has a devastated impact on many economies of the world. COVID-19 is not only a public health and

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QUESTION ONE Corona Virus Disease Pandemic (COVID-19) has a devastated impact on many economies of the world. COVID-19 is not only a public health and medical issue but also an economic and fiscal matter. Ghana recorded the first case of the virus in March 2020, three months into the implementation of the national budget. Therefore, the cost of fighting the disease is unbudgeted for, which has created a fiscal challenge for the country. The Minister of Finance recently in a statement to Parliament' estimated that the fiscal impact of COVID-19 may stem from the shortfall in petroleum receipts, shortfall in import duties, shortfall in other tax revenues, the cost of the preparedness plan, and the cost of Coronavirus Alleviation Programme (CAP) which will altogether cost the country an extra GHS9,505 million. In the statement, the Minister of Finance posits that COVID-19 will have severe impact on the fiscal targets contained in the 2020 Budget Statement and Economic Policy. It is estimated that the overall fiscal deficit will increase from the programmed GHS18.9 billion (4.7% of GDP) to GHS30.2 billion (7.8% of revised GDP). The primary balance will correspondingly fall from a surplus of GHS2,811 billion (0.7% of GDP) to a deficit of GHS5.6 billion (1.4% of GDP). The Minister therefore proposed the following measures, among others, to close the fiscal gap: i) Arrange with Bank of Ghana (BOG) to defer interest payments on non-marketable instruments estimated at GHS1,222.8 million to 2022 and beyond; ii) Adjust expenditures on Goods & Services and Capital expenditure (Capex) downwards by GHS1,248 million; Secure the World Bank Development Policy Operations (DPO) of GHS1,716 million; and iv) Secure the IMF Rapid Credit Facility (RCF) of GHS3,145 million. V) Use of monies in Ghana Heritage Fund? 111)

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