Skip to main content

Ghana’s rising debt due to discontinuation of our prudent measures – Terkper

A Former Finance Minister, Seth Terkper, has blamed Ghana’s increasing debt on the discontinuation of measures put in place by the erstwhile government.

According to him, that situation put the country in a very dire position.

Within the 1st quarter of 2020, Ghana increased its debt by 16.9 billion cedis, putting the debt at 236.1 billion cedis, representing 59.3 percent of GDP.

Also the Finance Minister, Ken Ofori-Atta, has already predicted a slow growth rate due to the impact of the Covid-19 pandemic.

Speaking on CitiTV’s Point of View Show, the former Finance Minister said the pandemic could have had less impact if government had adhered to measures aimed at helping middle income economies to withstand economic shocks to some extent.

“They discontinued what the middle income countries are doing to become stronger. I’m saying that it is in the debt report for 2020. It starts from 2014 where it started after the smart borrowing policy and it started going down again. You see that it started going up again in 2017.”

Pointing to a graph, Terkper  said “The orange line is the rate which you are adding to the debt and your debt level will not go down or will not stabilise if you don’t reduce it. So, this is in the debt report. This is in the 2019 budget so how can you say that they reduced the rate of going for debt and it is in the debt management report of the government”- he quizzed.

He also stated that government was too quick to seek for support from the IMF given the claims that the economy was being managed better.

“Why did we make a U-turn after we exited the IMF. Exit means that you won’t go to the IMF for a programme. We went to the IMF in March, very early into COVID.”

“The question we should ask is why didn’t other African countries rush to go to the IMF in March and April? According to the government, we had a stronger economy than other African countries and we were comparing ourselves to”

The outbreak of COVID-19 required governments to move rapidly to cushion individuals and businesses against the economic effects.

This resulted in increased government and external financing needs as policy interventions were drawn to sustain household income, business activity, and the macroeconomic fundamentals to allow for a quick and sustainable recovery.

While these measures imply substantial costs to public finances, many observers also urged African leaders to be cautious as the cost of inaction – a long-term destruction of productive capacity – would be even higher.

Source: Citinewsroom

Labels:

Comments

Post a Comment

Popular posts from this blog

Fitch Solutions retains 2025 growth rate projection at 4.2%

 Fitch Solutions has reaffirmed its projection that Ghana’s economy will expand by 4.2% in 2025. This estimate slightly exceeds the International Monetary Fund’s forecast of 4% and the World Bank’s projection of 3.9%. The UK-based research firm attributes its outlook to historically high gold prices, which are expected to cushion the Ghanaian economy against a global slowdown triggered by rising tariffs. Higher gold prices are anticipated to strengthen government revenue, enhance foreign exchange earnings, and help sustain currency stability. The report also highlights that Ghana is relatively less vulnerable to increasing trade restrictions from the United States, given that its primary exports—gold and crude oil—are not directly affected by the tariffs introduced by President Trump’s administration. Moreover, the US constitutes only about 4% to 5% of Ghana’s total exports. In contrast, Ghana’s trade relations are more heavily oriented toward China and European countries, particul...
Post a Comment
Read more

BoG injects $20m into FX market to support 11 BDCs

  The Bank of Ghana (BoG) has injected $20 million into the foreign exchange market in the latest round of its forward FX auction targeted at Bulk Oil Distribution Companies (BDCs). The intervention, which benefited eleven BDCs, is part of the central bank’s broader strategy to stabilise the cedi and ensure price stability in the petroleum downstream sector. Held on Tuesday, April 29, the auction was priced at a locked exchange rate of GHS 14.28 to the US dollar, with bid offers ranging from GHS 13.85 to GHS 15.55. This move reflects the BoG’s continued effort to deepen forex liquidity and safeguard the domestic fuel supply chain against volatility in global energy markets. By directly supplying FX to BDCs, the central bank seeks to ease pressure on the interbank market, guarantee the uninterrupted flow of petroleum products, and mitigate the pass-through effects of exchange rate fluctuations on fuel prices. The $20 million disbursement forms part of a $120 million programme for th...
Post a Comment
Read more

Kenpong Travel & Tours Champions Breast Cancer Awareness During Customer Week

  As part of activities to mark Customer Week, Kenpong Travel & Tours, a leading travel agency in Ghana, is joining the global fight against breast cancer. October is Breast Cancer Awareness Month, and the company is passionate about spreading hope and support to those affected. At Kenpong Travel & Tours, we believe that travel and exploration can be therapeutic and empowering. That's why we're committed to supporting our customers and the broader community in the fight against breast cancer. We're proud to stand in solidarity with breast cancer warriors and survivors. At Kenpong Travel & Tours, we believe that everyone deserves a chance to explore the world and create unforgettable memories. Let's prioritize health, support one another, and fight against breast cancer," said Kennedy Agyapong, CEO of Kenpong Travel & Tours. Our efforts are focused on raising awareness, promoting early detection, and supporting those affected by breast cancer. We urg...
Post a Comment
Read more