Why Ghana makes huge revenue windfall from global crude price hikes - John Jinapor explains

The Ranking Member of Parliament's Mines and Energy Committee, John Jinapor, has 'shot down' government's claims that the Russia-Ukraine war is the cause of Ghana's economic difficulties.

According to him, "the evidence as contained in the 2022 semi-annual report on Petroleum receipts has revealed that Ghana is making huge windfalls from the sale of crude oil, royalties, tax payments and surface rentals from the three oil producing fields bequeathed to the current NPP Government".

John Jinapor who doubles as the Member of Parliament for Yapei-Kusawgu constituency in a statement further indicated that "Ghana is indeed blessed with abundant natural resources generating significant revenues to the national purse, the hard truth is that the current economic hardships can only be the result of bad leadership and poor decision making by the current managers of the economy".

Ghana Makes Huge Revenue Windfall From Global Crude Price Hikes!

Contrary to the narrative by the Akufo-Addo/Bawumia-led government that the Russia/Ukraine war is impacting negatively on revenue mobilisation on all fronts, the evidence as contained in the 2022 semi-annual report on Petroleum receipts has revealed that Ghana is making huge windfalls from the sale of crude oil, royalties, tax payments and surface rentals from the three oil producing fields bequeathed to the current NPP Government.

Section 4.1 (page 31) of the PIAC report confirms that an amount of $731.94 million was realised from Ghana’s oil resources in the first half of 2022. This amount is equivalent to about GH¢6.7billion (using an exchange rate of $1 to GH¢9.2) which has already surpassed the total annual projected Petroleum revenues estimated at GH¢6,628 million under paragraph 253 of the 2022 Annual Budget statement presented to Parliament in November 2021.

From this development, it is obvious that Ghana is on course to achieving a quadruple or more of the original projected revenues from the Jubilee, TEN and Sankofa Gye-Nyame fields for the 2022 fiscal year.

In addition, other revenue handles have witnessed significant positive out-turns over and above their projected targets.

For instance, the 2022 Fiscal data report from the Ministry of Finance reveals that the Price Stabilisation & Recovery Levy alone has so far accrued GH¢798,021,065 as compared to a projected figure of GH¢269,348,015, which is almost 300% more than the revenue target for the first two quarters of the year, 2022.

We therefore wish to reiterate our position that some portions from these extraordinary windfalls can be used to cushion the ordinary consumer in terms of soft subsidies at the pumps.

It is important to remind the Economic Management Team (EMT) under Dr. Bawumia that a litre of diesel currently sells at the pumps at a whopping GH¢65.25 leading to severe hardships and suffering accros the country.

Ghana is indeed blessed with abundant natural resources generating significant revenues to the national purse, the hard truth is that the current economic hardships can only be the result of bad leadership and poor decision making by the current managers of the economy.

Signed:
Hon John Abdulai Jinapor
(Ranking Member, Mines and Energy Committee)