The recent five-day IMF visit, led by mission chief Stéphane Roudet, has added new dimensions to the budget expectations, as the fund's team engaged in preliminary discussions about the policy framework that will underpin the 2025 budget while assessing Ghana's progress under its $3 billion Extended Credit Facility arrangement.

The high-level meetings between the IMF delegation and newly inaugurated President John Mahama, Finance Minister and Bank of Ghana Acting Governor Dr Johnson Asiama marked the first significant engagement between the fund and the new administration, establishing what appears to be a constructive foundation for future cooperation.

Market analysts and economic observers are now watching how this initial engagement will influence the upcoming budget presentation, particularly as the IMF's fourth programme review looms in April 2025, adding an extra layer of scrutiny to the government's fiscal plans.

The new administration inherits an economy showing early signs of stabilisation, with the recent IMF visit suggesting potential flexibility in approaching the country's economic challenges while maintaining programme commitments.

A major focus of the budget is expected to be debt sustainability. The government's approach to managing the country's debt portfolio while creating room for growth-enhancing expenditures will be closely monitored within the context of IMF programme requirements.

The budget is anticipated to outline specific measures to boost domestic revenue mobilisation, with potential reforms likely influenced by recent discussions with the IMF team. 

The government's strategy for expanding the tax base while ensuring compliance with social equity considerations will be crucial.

Industry players are particularly interested in potential reforms to existing revenue measures, especially given the need to balance IMF programme requirements with the new administration's campaign promises of relief to businesses and citizens.

During his vetting, Dr Forson gave an assurance that the government would not adjust tax rates upwards to generate enough revenue.

He said his strategy for boosting revenue would focus on tax compliance.

"We don’t necessarily need to increase taxes to raise revenue. We have the tools at our disposal, and I will work closely with the Ghana Revenue Authority (GRA) to ensure we collect the necessary revenue by enhancing compliance," he said.

He was confident this approach would improve Ghana’s tax-to-GDP ratio, from the current 13% to 16%.

The finance minister reiterated the government’s commitment to reducing the tax burden on Ghanaians, promising to review and eliminate certain taxes where needed. 

The taxes earmarked for removal include the betting tax and the E-levy.

Monetary policy coordination will be another crucial area, with the budget expected to detail how fiscal policies will complement the central bank's efforts to control inflation and maintain exchange rate stability.

This is very critical, especially at a time when the country missed its 2024 inflation target of 15%. The December 2024 inflation rate stood at 23.8%.

Dr Forson has made a firm commitment to reduce inflation to 8% in the medium-long term. 

He said expenditure management was key to achieving this, adding that once this was achieved, it would help the central bank and monetary authorities to preserve reserves and protect the cedi or intervene when necessary.

Social intervention programmes, a key component of the new administration's campaign promises, will need to be carefully balanced against the IMF's fiscal consolidation requirements, with the budget expected to detail how this equilibrium will be maintained.

The agricultural sector is also anticipated to receive significant attention, with potential announcements on modernisation initiatives that align with both domestic priorities and international partner expectations.

Job creation initiatives, particularly focusing on youth employment, are likely to be central to the budget presentation, though they will need to be framed within the context of fiscal sustainability requirements discussed during the IMF visit.

Healthcare financing is expected to feature prominently, with possible announcements on investments in health infrastructure that align with both domestic needs and international best practices discussed with the IMF team.

The education sector may see new initiatives, particularly regarding the financing of existing free education programmes, with careful consideration given to maintaining fiscal discipline under the IMF programme.

The government's approach to energy sector debt and legacy issues in the power generation sector is expected to feature prominently, particularly given their significance to the IMF programme benchmarks and overall fiscal sustainability.

The Minister of Energy, John Jinapor, has constituted a seven-member committee to explore privatisation options for the Electricity Company of Ghana (ECG).

He said the initiative aimed to boost operational efficiency and improve power distribution across the country.

The upcoming budget is therefore expected to provide more details on this plan.