Speaking Points, Ambassador Lang , MDBS: signing of the bilateral agreement

Honourable Minister
Esteemed Chief Director
Distinguished guests

It is my great pleasure to sign with you today our new bilateral budget support agreement. This agreement reiterates our strong commitment to work with the Government of Ghana to reduce poverty and enhance economic growth through budgetary support.

With this new agreement, Switzerland pledges CHF 27 million in budget support over the period 2009-2011. Our contribution aims to help increase support in areas that are key for the reduction of poverty such as health, education and the development of the private sector as well as for the strengthening of good governance. Switzerland’s support is a non-refundable grant and comes in the form of Multi donor budget support, the so called MDBS.

Switzerland, together with ten other development partners, has been providing budget support to Ghana via MDBS since 2003. MDBS currently amounts to approximately US$ 350 million per year.

Switzerland will be co-chairing the MDBS development partners group together with the World Bank starting from June 2009. We are very much looking forward to working jointly with your Government in moving the MDBS aid modality forward. We are confident that our tenure as co-chair will, as in the past years, be marked by a high spirit of partnership and the determination to strive for development results.

Honourable Minister, Ghana has achieved strong economic growth over the past years and that has led to impressive results in reducing poverty. This has become possible thanks to sound economic reforms and macro-economic stability. Your country chalked up strong gains on the Millennium Development Goals, such as achieving universal primary education. Its political track record, too, is very encouraging. The democratic contest at the end of last year brought about a peaceful change of government. It was the fifth consecutive time Ghana successfully carried out democratic presidential and parliamentarian elections. It has thereby significantly strengthened its role as a beacon of political stability on the African continent.

It is obvious, Honourable Minister, that many challenges remain. One new challenge is the global financial crisis. Unfortunately, Ghana, like many other developed and developing countries, is not sheltered from this crisis which is expected to impact on remittances, unemployment and Ghana’s access to international credit. Switzerland is committed to support Ghana during these difficult times.

At the same time, Ghana needs to address new internal challenges such as its important fiscal deficit and the current account deficit which both soared during 2008. In the budget statement for 2009, your government commits to address these challenges. Switzerland considers continued macro-economic stability a crucial element for providing budget support. Developments in this regard will be followed attentively by MDBS partners and they will take centre stage in the up-coming IMF Article IV consultations.

The MDBS process constitutes a core part of Switzerland’s development portfolio in Ghana. Ghana is considered an important focus of Switzerland’s development assistance. It is one of seven world-wide priority countries in terms of economic development cooperation, carried out by the Swiss State Secretariat for Economic Affairs (SECO). On the African continent there are only two other such priority countries: South Africa and Egypt.

Last month, Switzerland and Ghana agreed on a new four-year country assistance strategy for Switzerland’s economic development assistance. In line with this strategy, which includes MDBS, Switzerland will support Ghana with another 9 Mio. Swiss Francs yearly in the areas of private sector development, energy sector infrastructure, trade sector development as well as macroeconomic stability and public financial management reforms.

For Switzerland, the concentration on less countries world-wide in the field of economic development cooperation, alignment with partner country priorities, the use of partner country systems, and harmonisation with other donors are central. The renewal of Switzerland’s support to the budget of your country is a concrete expression of our commitment to the tenets, which are in line with the Paris Declaration on Aid Effectiveness and the Accra Agenda for Action adopted at the 3rd High Level Forum of last September here in Accra.

Honourable Minister, Chief Director, distinguished guests, ladies and gentlemen, in conclusion, let me express my hope that the signing of this agreement will further cement our two countries’ commitment to fighting poverty and accelerating economic growth to the benefit of all Ghanaians.

Thank you.