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Ghana: Ghana Economy Profile


  Cash Economy


 Ghana’s economy has maintained commendable growth trajectory with an average annual growth of about 6.0% over the past six years. In 2013 growth decelerated to 4.4%, considerably lower than the growth of 7.9% achieved in 2012. Growth has, however, been broad-based, driven largely by service-oriented sectors and industry, which on average have been growing at a rate of 9.0% over the five years up to 2013. Over the medium term to 2015, the economy is expected to register robust growth of around 8%, bolstered by improved oil and gas production, increased private-sector investment, improved public infrastructure development and sustained political stability.

The continued widening of the budget deficit has been a major constraint to fiscal and debt sustainability. Following an expenditure overrun in 2012, marked by an unprecedented budget deficit of around 12% of GDP, the situation persisted in 2013, with about the same level of budget deficit. Revenue enhancing and expenditure consolidation measures underway in 2014 are expected to ease the fiscal deficit to 9%. In conjunction with fiscal constraints, inflation has been on the rise resulting from a number of factors including the removal of subsidies on petroleum prices and a gradual rise in electricity and water tariffs. It is also worth noting the rise in public debt from 43% of GDP in 2011 to 48% in 2012, and further to 53.5% in September 2013, resulting from a widened budget deficit. The external sector will continue to experience a widened current account deficit of around 12% of GDP in 2014, exacerbated by a decline in commodity prices of major export commodities, particularly on gold and cocoa.

With the exception of some food processing and significant exports of gold and unprocessed cocoa, Ghana is relatively less integrated into global value chains due to its infant industry. Yet, compared to its regional peers, Ghana has the industrial capabilities to export and drive regional value chains in Economic Community of West African States (ECOWAS) countries. Ghana’s geographical proximity to ECOWAS markets, projected rise in consumption and lower standard requirements offer Ghanaian industrial firms opportunities to scale up and increase their productivity. For the industrial sector to grow, authorities need to tackle the constraints relating to the cost of credit and to the unreliable supply of energy, in order for leading industrial sectors in construction materials, textile, agro-processing, plastics and pharmaceuticals to expand. Non tariff barriers also add a significant burden to the development of these regional value chains.


  • Ghana’s economy is expected to maintain robust growth over the medium term, bolstered by improved oil and gas production, increased private-sector investment, improved public infrastructure development and sustained political stability.
  • Promoting the integration of Ghana’s industrial sector into regional value chains could underpin the country’s structural transformation on condition that authorities take measures to improve agricultural productivity, and address challenges in infrastructure and in the business environment.
  • With the exception of maternal and infant mortality, sanitation and employment, Ghana has made substantial progress in meeting the Millennium Development Goals (MDGs), as targets for the reduction of extreme poverty and access to safe drinking water have been achieved, while targets on hunger, education and gender are on track.


Macroeconomic Policy

Fiscal Policy
The government’s fiscal policy for 2009 was aimed at arresting the deteriorating fiscal situation that had culminated in an overall deficit (excluding divestiture receipts) of about 14.5% in 2008. Consequently, in 2009, the government pursued policies which sought to improve public expenditure management, enhance public financial management, restructure state-owned enterprises and continue with the reforms of the public sector. Fiscal outcomes in 2009 improved compared with outcomes in 2008. But in relation to the target set for 2009, the overall fiscal outcome was worse – the estimated deficit for 2009 was 10% of GDP compared with the target of 9.2% of GDP. Government expenditures decreased from 42.4% of GDP to about 38% in 2009, owing to a decrease in both recurrent as well as capital expenditures. Most items in the current account decreased, including wages and salaries, and goods and services. However, owing to substantial government borrowing in the preceding year, interest payments increased in 2009. On the revenue side, there was a slight increase in total revenue and grants in 2009. Grants followed a pro-cyclical trend, increasing by 6% in 2009. Tax revenues as a share of GDP remained roughly constant. Improved revenue mobilisation and spending cuts combined to reduce the fiscal deficit to an estimated 10% of GDP, down from 14% in 2008. The fiscal deficit is projected to improve to a deficit of about 6.4% of GDP in 2010 and 3.1% in 2011 thanks to anticipated oil revenues and improvements in domestic revenue mobilisation.

Monetary Policy
The first half of 2009 recorded very high increases in the general price level in Ghana, probably as a "hangover" from the previous year – the high food and energy prices coupled with the deteriorating local currency. Price increases in 2008 were also the result of an excessive expansion of the money supply in the run-up to the general elections in December 2008. By December 2009, inflation had reached 16% after a peak of 20.7% in June 2009. This puts the average inflation for 2009 at 19.3% – the highest in five years.

In line with developments in the global environment, and in conformity with the macroeconomic targets for 2009, monetary policy was expected to play a supportive role to fiscal policy, continuing down the path of disinflation and fiscal consolidation. The underlying medium-term objective was to reduce inflationary pressures and stabilise price and exchange rate expectations. In particular, the central bank aimed at reducing the end-period year-on-year inflation towards 12.5% by end-2009 and further to 10% in 2010 and 8% in 2011. The 2009 inflation target was later revised by the Bank of Ghana to 14.6% since inflation expectations continued to be high partly because of currency depreciation. During the year, a new governor was appointed and it was not clear whether the formal inflation targeting framework used by his predecessor would be continued. However, the 2009 budget statement clearly indicated that the Bank of Ghana would continue to use its inflation targets to guide inflationary expectations in line with the medium-term forecast. The Bank of Ghana’s efforts to ensure monetary stability by drastically reducing the money supply were also guided by the West African Monetary Zone (WAMZ) convergence criteria. These have been set to ensure that five West African countries (Gambia, Ghana, Guinea, Nigeria and Sierra Leone) adopt the ECO, the single currency for the monetary zone. By keeping interest rates high, the money supply was eventually brought back under control, the depreciation of the local currency slowed down and inflation began to decelerate during the last half of the year. The growth rate of money supply during 2009 was relatively slower than in the pre-crisis years.

From the second half of 2009, the tight fiscal and monetary policy pursued by the new government began to yield dividends in the form of a continuous decline in inflation. The harvest season was favourable in 2009 and this supported the decline in food inflation over the period. The recent decline in inflation is indicative of the tight monetary and fiscal policies pursued by the new government in response to the difficult macroeconomic environment in 2009. Looking ahead, inflation is projected to decline to 10-12% by end-2010. The risks to the medium-term inflation target include: exchange rate movements; the wage policy in 2009; the recent sharp increases in fees and charges (road and bridge tolls, company registration fees, passport fees, land titling fees, etc.); and the possible increases in utility prices.

External Position
In 2009, Ghana continued to pursue policies to achieve the long-term objective of an agro-industrial economy, which is contained in the strategic growth framework of the Growth and Poverty Reduction Strategy II (GPRS II). As a founding member of the Economic Community of West African States (ECOWAS), Ghana continued negotiations with other ECOWAS countries on a new list of goods that would attract the highest import tariff rate of 35% under the ECOWAS Common External Tariff (CET). These are expected to be locally produced goods considered as special and having the potential to enhance economic development in the region. Ghana has set up a tariff advisory board as part of measures to promote a transparent domestic tariff regime and ensure a level playing field for all economic agents (national and foreign direct investors as well as consumers). At the same time, as a member of the WAMZ, Ghana continued to work with other member countries to meet the primary and secondary convergence criteria for the adoption of the ECO as the single currency for the monetary zone.

Notwithstanding the global recession, Ghana’s external sector performance was quite respectable, recording large improvements in trade and the current account deficits, which had deteriorated sharply in 2008 owing to both domestic policy adjustment failures and external shocks attributed to the global food and energy crises. Indeed, provisional estimates indicate that the external payments position recorded significant improvement due to the terms of trade advantages and improvement in the current account. The balance of payments recorded an overall estimated deficit of USD 29.5 million, down from USD 717 million the year before. The commodity trade deficit also narrowed to 27.2% of GDP from 31% in 2008. Exports of goods as a percentage of GDP are provisionally estimated to have declined marginally by 1.3 percentage points below the 2008 level, but imports of goods as a share of GDP declined more, by 5.2 percentage points. The external current account and trade deficits are projected to improve moderately in 2010 and 2011 thanks to oil-related exports.

According to official figures released by the Bank of Ghana, private inward transfers received through the banks for 2009 are estimated to have declined by 1.3 percentage points from that of the first half of 2008. The capital and financial account for the period up to September 2009 declined from a surplus of USD 2.6 billion in 2008 to a smaller surplus of USD 1 billion in 2009. Ghana’s gross international reserves improved from an equivalent of 1.8 months of imports cover at end-2008 to an estimated 2.4 months in 2009.

Total external debt in Ghana increased moderately in 2009 by about USD 600 million to about USD 4.6 billion. The increase in the external debt stock was mainly due to the project financing disbursement for the West African Gas Pipeline, Bui Dam project, and borrowings to improve electricity sub-transmission and expansion. Because of the substantial government borrowing in 2008, interest payments increased in 2009.

Structural Issues

The objective of the government to make the private sector the engine of growth remained on course in 2009. To enhance Ghana’s competitiveness in global and regional markets, the government continued to implement policy reforms to lower trade barriers and the cost of doing business, and to promote greater efficiency among local entrepreneurs. According to the World Bank’s Doing Business report, Ghana’s rank declined 5 positions: from 87 in 2008 to 92 out of 183 in 2009. The high cost of borrowing and high inflation are among the major challenges faced by people who want to start a business in Ghana. According to the government of Ghana’s budget statement for 2010, end-period consumer price inflation declined from a peak of 20.6% at the end of the first quarter of 2009 to 18% at the end of the third quarter 2009. That is against a 91 day treasury bill hovering at an interest rate of around 25%. The process of starting a business remains one of the challenges of Ghana’s business environment. Other challenges include a weak institutional framework and unreliable power supply.

In 2009, the Ministry of Trade and Industry instituted measures aimed at assisting micro, small and medium enterprises (MSME) to overcome the challenges of starting a business, managing a business and dealing with the legal and regulatory issues pertaining to the business environment in Ghana. The ministry also instituted the MSME project through the Business Development services fund to provide credit assistance to small and medium enterprises (SMEs). The ministry also supported various Business Advisory Centres (BACs) through capacity building.

In the communication sector, the government pursued the goal of facilitating the development of reliable, cost-effective and world-class communications infrastructure and services, driven by appropriate technological innovations and access for all citizens, to enhance the promotion of economic competitiveness in a knowledge-based environment. The government continued to provide an enabling environment, which promoted competition among telecom operators in the sector resulting in tremendous growth in telephone subscriptions of fixed line and mobile telephone sub-sectors. To ensure universal access to telecommunications infrastructure, the government embarked on the Community Information Centres (CICs) project, in which 120 CICs were under construction nationwide.
The education and health component of the Pan-African e-Network project was completed in 2009. The government’s commitment to enhancing telecommunications in the country was obvious with its resolve in monitoring the enlarged Ghana Telecom (GT) and Zain Communications in which the state has shares, to ensure efficiency in service delivery and also improve their contribution to national output. In line with ensuring technological advancement in the sector, the government put plans in place to collaborate with industry players to work out technical feasibility and define the technical parameters for smooth implementation of Mobile Number Portability (MNP) as a way of encouraging healthy operator competition and increasing consumer choice of service. The mobile penetration rate increased from 53% in 2008 to 64% by July 2009, representing growth of about 11%. Fixed line subscriptions increased by 84.9% in 2009, from 2008 figures, with the penetration rate of fixed lines increasing from 0.7 % as of December 2008 to 1.2 % by July 2009.

In 2009, the government continued efforts to improve the financial sector further. Ghana adopted the use of an automated trading system while remote trading on the trading floor of the Ghana Stock Exchange began via Wide Area Network (WAN) and the Internet in 2009. In addition, the second Financial Literacy Week was celebrated to raise public awareness about the various financial services, products and opportunities available to households, MSMEs and the private sector. Additionally, the first licensed Credit Bureau Referencing Company, Xpart Decision Systems Data (XDS Data), started operating. Also, in an effort to improve transparency, the Bank of Ghana has published guidelines for the wholesale auction of government securities.

Developments in the domestic banking sector represent an important transmission channel of the global economic and financial crises to the Ghanaian economy. Ghana did not experience any serious disturbance in its financial market like the ones that have rocked the advanced and emerging economies, but there is evidence of increased strains in the financial sector in recent months. The credit crunch has made Ghanaian banks reluctant to lend to the private sector. Credit conditions surveyed by the Bank of Ghana in December 2008 revealed a general tightening of credit conditions for enterprises in 2009. Banks continue to have a favourable but more selective credit stance for households through the use of non price terms and conditions such as shortening of the maturity of loans or credit lines, and the requirement of additional loan covenants and collaterals. There are also reports of increases in non-performing loans because of the deceleration in economic activity. The quality of the banks’ aggregated loan portfolio is reported to have deteriorated owing to substandard and doubtful loans.

Ghana’s equity market, though not all that integrated with the global stock market, experienced a slump beginning in the fourth quarter of 2008 and continuing through the second quarter of 2009. The situation was not much different from the downward trend observed in most global capital markets, as a result of low market activity characterised by low demand and ample supply for listed securities, creating downward pressure on share prices. The turmoil in the stock exchange market is partly responsible for the significant negative effects on the financial sector’s balance sheet and on aggregate demand. It has a tendency to increase non-performing loans in the banking sector with negative consequences for financial stability in the country.
Other Recent Developments
Confidence that Ghana will start oil production was boosted when government approved the Phase 1 Plan of Development for the Jubilee field in July 2009, after it was submitted by the consortium of companies that are in partnership with the Ghana National Petroleum Corporation (GNPC). The development of the Jubilee field is on course and production of oil and gas will commence in the last quarter of 2010. Major infrastructure projects in 2009 included the Rural and Urban Water Supply and Sanitation with the government of Ghana as main investor, construction of decent and affordable housing, flood control programmes, and coastal protection programmes. Major projects were also undertaken in the transport sector (rail, maritime and aviation). Detailed aviation policy guidelines were developed by the Ghana Civil Aviation Authority (GCAA), which has the oversight responsibility of regulating air transport services as well as the provision of air navigation services.

In 2009, government initiated measures to ensure food security and continue with ongoing reforms. Implementation of the Modernisation of Agriculture Policy was executed through the Youth in Agriculture Programme aimed at increasing food production. This programme also sought to create employment for youth. The major step toward reform in the agriculture sector in 2009 was the launching of the Agricultural Sustainable Land Management Strategy and Action Plan (AgLSM). The policy is aimed at addressing various barriers to the acquisition of land, especially for agricultural production.
The government continued in its efforts to enhance tax administration and improve revenue mobilization. It commissioned a review of the nature and scope of tax exemptions and discretionary waivers with the resolve to eliminate several of these exemptions this fiscal year.

Public Resource Mobilisation

Tax revenue has generally increased over the last ten years. This increase can be attributed to the increasing efficiency of tax administration in Ghana and tax policies that have been pursued since 2000. Non-tax revenue has also shown even stronger growth over the period. This performance has been driven by two key factors: the decision to take advantage of the Heavily-Indebted Poor Countries (HIPC) debt relief in the early 2000s; and the improved macroeconomic and political environment that sustained increased aid flows during the period. The stronger growth in non-tax revenue, including grants and official development assistance (ODA), has increased in importance over the years, relative to tax revenue – the share of tax revenue to total revenue decreased from 82 % in 2000 to about 72 % in 2009 – mainly on account of increasing foreign aid and non-tax revenue.

Aid flows to Ghana have increased over the years and the increase in the past two decades can be attributed to economic performance and the goodwill the government enjoys in the donor community. Since 2000 aid flows by type have witnessed significant increases though not consistent throughout the years. After registering a decline in 2002, both budget support and project aid increased over the period from USD 85.07 million and USD 195.7 million in 2002 to USD 751.58 million and USD 379.95 million respectively in 2005. This represents an average of USD 300 million (36% of total aid flows) for budget support aid and USD 450 million (64% of total aid flows) for project aid. The introduction of the Multi-Donor Budget Support (MDBS) framework in 2003 is largely responsible for the improvement in budget support aid, though it is still below the annual average for project aid. In 2009, grants recorded an increase of 12.0% of the projected out-turn, representing 5.3% of GDP. Also, expected grants for 2010 will contribute 14.2% of the estimated total revenue and grants. Revenue from the HIPC Assistance and Multilateral Debt Relief Initiative (MDRI) are expected to yield 131.6 million cedi (GHS) and GHS 93.9 million respectively.

Ghana’s debt stock has declined consistently from about 189% in 2000 to about 46% in 2007 with both external and domestic debt following a similar trend from 160% and 29% to 22% and 24% respectively during the same period. This was largely a result of a combination of appropriate fiscal and monetary policies as well as debt relief under the enhanced HIPC Initiative and the MDRI. However, by the end of 2008 the country’s debt situation worsened with foreign debt reaching about GHS 8.5 billion. This was attributed to increased borrowing on non-concessional terms for projects that were, for the most part, economically unproductive.

In order to strengthen Ghana’s external debt management, the government proposes to provide clear objectives on debt management in 2010. This will entail identifying portfolio risks and cost, and identifying potential funding sources. Also, it is expected that the current legal framework will be amended in order to: provide scope for issuing new financial instruments; improve the reporting of debt management; and streamline the institutional framework for debt management.

The main sources of tax laws in Ghana include the Internal Revenue Act, 2000 (Act 592), the Internal Revenue Regulations (L.I. 1 675), Value Added Tax, 1998 (Act 546), the Value Added tax regulation (L.I. 1646) and annual amendments. The tax authorities in Ghana include the Internal Revenue Service (IRS), VAT service, and Customs Excise and Preventive Service. These are all governed by the Revenue Agencies Governing Board (RAGB). The World Bank 2010 Doing Business report shows that Ghana’s position in terms of paying taxes relative to other countries worsened – from a rank of 66 in the 2009 Doing Business report to 79 in the 2010 report. However, the components under the paying tax index does not show deterioration. The tax rate (percentage of profits) and the number of hours used to pay taxes in a year all improved in 2010 relative to 2009.

The tax effort in Ghana has improved over the last ten years. As a share of GDP, all the three main tax components (direct, indirect and international trade taxes) have increased since 2000. But the relative importance of these tax sources has changed over the period 2000-09. Although indirect taxes remain the most important source of tax revenue, its importance has decreased over the years. International trade taxes have also decreased in importance over the years.

Tax revenue as a percentage of GDP has increased from less than 17% to about 23% over the period 2000-09. The effective tax base in Ghana remains low in spite of the improved tax effort. This is because many people operate in the informal sector and therefore remain outside the tax net. Personal income taxes in Ghana are calculated on income accruing in, derived from, brought into, or received in Ghana if you are a resident. For a non-resident, this income must be accrued in, and derived from, Ghana, whether the income is received in Ghana or not. Personal income from employment and from running a business is subject to a graduated set of income tax rates. Personal income tax currently has five bands with rates ranging from zero for the first GHS 240 to 25% for incomes exceeding GHS 9 600. Companies’ tax is generally on business incomes and is at a rate of 25%. The main form of indirect tax is the 12.5% VAT. There is also a 2.5% National Health Insurance levy – it is also a VAT – on goods and services. Exempted from VAT are: agricultural products and inputs, printed matter, approved medical and pharmaceutical supplies, transport, financial services, land, building and construction.

Tax policy in Ghana over the last ten years has mainly been aimed at increasing efficiency and a widening of the tax net. Successive governments since 2000 have either introduced new taxes or increased the tax rates. Notable among these were the increases in petroleum taxes, the introduction of the National Reconstruction Levy, the National Health Insurance Levy and the Communications Service tax.
Recent tax policies include a review of the exemptions and discretionary waivers given to institutions. This should help phase out some of the discretionary tax holidays granted to businesses. Government also has plans to phase out the zero-rating of certain items under VAT. The threshold and refund regime under VAT is going to be streamlined to help improve tax effectiveness. A particularly interesting policy measure is the simplification of the taxation of small businesses that fall below the VAT threshold. The aim is to rope in a lot more smaller businesses in the collection of VAT.

Current effort still aims at improving the efficiency of the tax system by reforming the tax administration. This entails broadening the operations of the large taxpayer unit (LTU) to ensure that very large companies receive a one-stop tax service. The LTU is responsible for the administration of all tax liabilities of the large taxpayer. In 2007, the government launched the VAT Flat Rate Scheme (VFRS), which is designed for traders operating in the retail sector (mainly in the informal sector). The VFRS comes with a minimum of record-keeping and requires traders to charge a flat rate of 3% of the value of each table item sold.

Ghana operates the Vehicle Income Tax Sticker (VITS) which was introduced in 2003. The VITS is paid on a daily or weekly basis by owners of commercial vehicles who are required to display their stickers on their windscreens for easy monitoring. Another important tax which was introduced in 2005 is the Tax Stamp, aimed at the self-employed. The implementation of the tax has involved the establishment of small tax bureaus (STB) in all the Tax Districts. Key problems with respect to the implementation of this tax include the high level of evasion.
Tax compliance in Ghana is generally constrained by the large size of subsistence agriculture and the informal economy. The government is increasing effort at designing and strengthening tax schemes that relate to the informal sector.

The increased tax effort is reflected in the increasing share of government spending that goes to the collection of taxes – this has increased from about 1.5% of total expenditure (about 0.5 % of GDP) in 2003 to about 3.05% of total expenditures (1.7% of GDP) in 2008. The bulk of the expenditures for revenue agencies is used to pay staff salaries (about 69%), followed by office supplies (16%), infrastructure (8.3%) and information technology (6.5%). Although the share of expenditures that goes to pay staff salaries has increased, there are still concerns about the efficiency of revenue collection. Indeed, the amount of revenue generated per GHS 1 expenditure has declined from about GHS 4 462 in 2003 to about GHS 3 156 in 2008. It is difficult to attribute this reduced efficiency to a lack of staff motivation as the increasing expenditures on staff have occurred as staff numbers have declined.

Social Context and Human Resource Development

The attainment of the MDGs remains on course though there are some outstanding issues to be addressed. Eight years ahead of the targeted date for the attainment of the MDGs (2015), Ghana has already achieved the target of reducing by half the proportion of the population who are classified as extremely poor as of 1992. The country is on track to meet the goals on primary completion (MDG2), gender parity at school (MDG1a), access to water (MDG3) and debt sustainability (MDG7).

In 2009, several new policies concerning education, especially basic education, were implemented. This is particularly encouraging given the fact that improvement in access to education is deemed to be pro-poor. The amount of money allocated as capitation grant was increased by 50%, resulting in a total of GHS 23.53 million to enable schools to provide additional services to improve teaching and learning. Expenditure on the school feeding program was also increased by 50% to provide food for about 1.6 million poor school children. These initiatives, among others, contributed to an increase in enrolment of 20% in beneficiary schools. Gross primary school enrolment increased from 93.7% in 2006/07 to 95.2% in 2007/08, while at the Junior High School level, gross enrolment increased from 77.7% in 2006/07 to 78.8% in 2007/08. Significant progress was also made in terms of providing tertiary education to all qualified Ghanaians. In total, the enrolment level in tertiary institutions increased by 6.4% during the year under review.

The government has continued its efforts to improve the access and quality of health care in the country to build on the success achieved in the previous year. The percentage of children under five dying from malaria fell to 1.9% in 2008 from 2.4% in 2007 due to the increasing use of insecticide treated nets (ITNs) among children under five years old and pregnant women. A number of projects were also implemented in 2009 with the aim of reducing maternal and neonatal deaths, enhancing health services for children, and improving the regenerative health and nutrition program. For example, 21 health centers and two modern district hospitals were built. The government also signed the revised Anti-Malaria Drug policy and completed the seven-year national Strategic Plan for Malaria Control in 2009. The proportion of the population registered under the social health insurance scheme in the country, the National Health Insurance Scheme (NHIS), increased greatly from 9 773 000 in 2007 to 12 468 558 in 2008, covering about 54% of the population. There was also a significant improvement in the coverage of the poor and needy under the NHIS, from 248 379 in 2007 to 302 979 in 2008, due to subsidies provided under the Livelihood Enhancement Against Poverty (LEAP) initiative in 54 districts.

Currently, Ghana’s HIV epidemic seems to have stabilized at a much lower rate than other countries in the sub-Saharan African region. After an increase in median HIV prevalence in 2006, there has been a steady decline since then. The 2008 HIV Sentinel Survey Report indicated that the median HIV prevalence rate declined from 2.6% in 2007 to 2.2% in 2008, the lowest rate in nine years. This improvement over last year’s result may be an indication of the positive impact of HIV and AIDS-related programs. However, the total number of people living with HIV in Ghana is estimated at about 250 000 with a cumulative death toll of 200 027. Also about 160 000 children in the country have been orphaned as a result of the disease. The need for more targeted prevention programs, therefore, cannot be overemphasized.

Prudent financial and project management strategies have been put in place to ensure that the financial support for social interventions is sustained. For example, expenditure on pro-poor programs as a percentage of total government expenditure increased from 24.9% in 2008 to 26.8% at the end of 2009. Additional plans for 2010 include provision of school infrastructure in deprived areas, increasing youth employment, scaling up community-based health facilities, and the provision of subsidies in the utilities sector to protect the poor against possible effects of deregulation.