1. HIGHLIGHTS OF GHANA’S ENVIRONMENTAL FISCAL REFORM POLICY (WIP) Presented by: Ebenezer Nortey (Ministry of Finance) at UNEP Regional Workshop on Inclusive Green Economies for Poverty Reduction and Sustainable Development in Africa, 28 th February - 1 st March 2015 at Cairo, Egypt

2. Outline Why Environmental Fiscal Reforms (EFR) Major Fiscal Policy Reforms Fiscal, social and Environmental implications Implementation/Institutional Arrangements Role of political economy, challenges and mitigation Conclusion

3. WHY EFR Poverty Reduction Addressing environmental problems that affect the Poor Improved access to environmental infrastructure Finances for pro-poor investments (e.g. education) Fiscal Benefits Revenue mobilization Reduced distortions Reduced drains on Public Finance Environmental Benefits Incentives for sustainable natural resource management Incentives for curbing pollution (air, water, soil) Funds for environmental agencies and investment

4. Major Fiscal Policy Reforms The EFR policy has 7 policy focus areas with 13 programme areas. These target the broad scope of environmental impacts and response in Ghana. The policy themes and their respective programme areas are as follows:

5. Policy ThemesProgramme Areas 1. Cross- sectoral programme area 1: programme area 2: programme area 3: programme area 4: Establishment of the Ghana EFR Commission Establishment of the Ghana Green Fund Systematic greening of Ghana's taxes and duties systematic greening of public budgeting systems and expenditure frameworks 2. Waste management programme area 5: programme area 6: Reform of plastic tax and product taxes as part of integrated waste recycling EFR incentives for municipal waste management

6. 3. Forestryprogramme area 7:Modifying revenue allocation of public timber sales and stumpage fees 4. Miningprogramme area 8: programme area 9: Royalties from registered small scale miners Import taxation of mining equipment and machinery 5. Transportprogramme area 10:Greening transport taxes and transport modes 6. Energyprogramme area 11: programme area 12: Carbon dioxide Tax Tax shift 7. Industryprogramme area 13:Industrial pollution taxes

7. Fiscal, Social &Environmental Implications Fiscal Implications: – Promote green and climate sensitive budgeting – Mobilization of resources (domestically and internationally, public and private) to address environmental problems – Reduced distortions – Reduced drain on public finance e.g. waste treatment cost, reclamation/rehabilitation costs, health costs, etc. Social Implications: – The EFR policy provides for strategic direction and coordination to achieve welfare gains for the entire society – The policy promotes technological innovation, as well as the development and growth of green industries in Ghana and the creation of new employment in these industries – Improve health of the people and longevity of life

8. Fiscal, Social & Env. Implications Contd. Environmental implications: The policy contributes to addressing the following environmental challenges Ghana faces: – Deforestation, unsustainable forestry practices, including related adverse effects, and protected areas development; – Environmental pollution and degradation, including associated livelihood challenges, caused by small scale mining; – Climate change mitigation and adaptation; – Inadequate waste management, including the development of waste recycling and reuse industries based on separate waste collection, decreasing costs of current waste management systems; – Unsustainable transport modes and related health and environmental impacts; and – Education, research and awareness programmes related to all the above listed areas – Inadequate funds for environmental agencies and investment

9. Implementation/Institutional Arrangements A number of national institutions and private sector organizations in Ghana whose mandates/activities touch on environmental fiscal reform issues shall play key roles in ensuring successful implementation. These institutions include the following: Ministry of Environment, Science, Technology and Innovation Ministry of Finance Ministry of Lands & Natural Resources Ministry of Local Government & Rural Development Ministry of Energy & Petroleum Ministry of Transport Ministry of Health Ministry of Education Non-governmental / Civil Society Organizations; and Private Sector

10. Role of political economy, challenges and mitigation The policy has outlined the ff. as critical to ensuring success: Governance, coordination and information Capacity building and Education Finance International cooperation Gender Research and Development Monitoring & Evaluation

11. Conclusion EFR is aimed at ◦ Achieving welfare gains ◦ Employment creation (via creation of green industries and green jobs) ◦ Addressing important environmental challenges in Ghana ◦ Mobilizing resources domestically and internationally for sustainable development ◦ Making the national budget green and climate change sensitive

12. THANK YOU