The Asantehene, has urged the Akufo-Addo government to be transparent and candid with Ghanaians on the current economic challenges facing the country, insisting that “the nation is currently in a tense mood” and called for an economic dialogue involving best brains.
“Government should be more accommodating and reach out to those who may even oppose them politically, the interest of the country is paramount, and we must all work together to prevent the collapse of the economy. No one can pretend not to see the difficult times that we find ourselves in. But at the same time I want to encourage all of us to keep hope alive”.
“Our debt level has become unsustainable pushing the government to roll out a domestic debt exchange programme that aims to restructure the nation’s debt and ensure some fiscal space for the country to operate”, Otumfuo Osei Tutu II said at the 56th congregation at Kwame Nkrumah University of Science and Technology (KNUST).
He said, “sadly it appears public consultation did not take place before the programme commenced. The nation is currently in a tense mood even though government has announced the completion of the programme. I want to implore government to demonstrate high level of transparency and be candid in these difficult times in order to win the trust and confidence of the general public”.
The Asantehene’s demand comes as the Ranking Member of Parliament’s Finance Committee, Isaac Adongo has intimated that it will be difficult for Ghana to secure any form of debt forgiveness from China due to the current economic and geopolitical position of the Asian giant to get the International Monetary Fund’s (IMF) US$3 billion.
The Minority Leader, Dr Cassiel Ato Forson, on the same subject matter noted that Ghana will not be able to secure the IMF board approval at the end of March 2023, contrary to claims by the government.
President Nana Addo Dankwa Akufo-Addo, recently expressed optimism that the government is systematically fulfilling the terms of the staff-level agreement reached with the IMF and is confident that it will secure a deal by the end of March.
Otumfuo Osei Tutu, called on the Akufo-Addo government to bring together best brains with the requisite expertise from the various political parties, academia and civil society organisations to present an excellent proposal to help Ghana secure a bailout that would be beneficial to all.
“Government should be more accommodating and reach out to those who may even oppose them politically, the interest of the country is paramount, and we must all work together to prevent the collapse of the economy. No one can pretend not to see the difficult times that we find ourselves in. But at the same time I want to encourage all of us to keep hope alive”.
Otumfuo Osei II said, “as we move to negotiate with our external creditors, I urge government to bring together the best brains with the requisite expertise from all political perspectives to present the finest proposal so that whatever decision the country chooses will be everyone’s responsibility”.
The Asantehene encouraged Ghanaians to ensure judicious use of resources in order not to overburden the economy.
“The current economic difficulties should serve as a wake-up call for all of us to carefully review our economy and implement some significant adjustments. The moment has come for us to reduce wasteful spending and direct resources towards economically productive areas in order to improve the quality of life of our people,” Otumfuo Osei Tutu II entreated.
The voluntary debt exchange programme seeks to tackle the current economic crisis, bring back macroeconomic stability and guarantee sustainable growth.
According to Ofori-Atta, not executing the domestic debt exchange programme would have brought “grave disorder” in its ability to service the country’s ballooning national debt and exacerbated the current economic crisis.
On Wednesday, March 15, government commenced payments of outstanding coupons to individual bondholders who failed to participate in the Domestic Debt Exchange programme.
In a statement, the coalition of Individual Bondholders confirmed the payments of matured coupons to its members but called on the Ministry of Finance to review its communication management and reposition it for proactive engagement with creditors as is professionally expected.
“While we welcome the commencement of payments, it is important to note that the failure to be definite about a payment schedule or a notification date for outstanding payments does not augur well for the rebuilding of confidence in the financial market.”
This came after the Coalition of Bondholders gave the government a 48-hour ultimatum to pay all their outstanding coupons or face their wrath.
President Nana Addo Dankwa-Akufo-Addo has called on the Diplomatic Corps to help Ghana’s bid for a $3 billion bailout at the International Monetary Fund (IMF).
Addressing members of the Diplomatic Corps at the Peduase Lodge on March 1, the President said with the cooperation received from the Paris Club, he is confident that the IMF deal will finally be concluded by the end of March.
“Just as we managed to achieve a staff-level agreement with the Fund in record time in December last year whose terms were systematically fulfilling including the difficult but ultimately highly successful process of the Domestic Debt Exchange Programme, I am confident that with the cooperation we have received from the members of the Paris Club and the People’s Republic of China, which sent a delegation from China’s EXIM Bank to Accra over the weekend to meet with officials of the Ministry of Finance, we shall be able to go to the Board of the Fund to conclude finally the agreement by the end of March,” he said.
Speaking on Eyewitness News on Citi FM on the difficulties facing Ghana’s plea to China for softer conditions to repay debts owed to China, Mr Adongo, said the political and economic ideology of China is not in sync with the conditions of the Paris Club which poses a greater risk for any debt relief.
“We need our friendly nations and the bilateral countries to come together and form a committee, but it has been difficult to get China to come to the table even though China is our biggest bilateral lender. The complexity of the China situation is that there are some bits of geopolitics involved where China does not see the Paris Club as anything other than a Western influence and would always want to have equal arrangements with individual countries.”
Mr Adongo, also stressed that the timing of Ghana’s engagement with China is not encouraging as there are other African countries seeking the same help from the Asian powerhouse.
“Unfortunately for us, we have arrived in China at a time when other African countries are already queueing to borrow from them and so it will be difficult for Ghana to jump that queue because whatever China agrees with Ghana will have to be fair with the other countries we came to meet. And also, traditionally, China does not believe that a sovereign country can be poor but does believe that a country can be broke like we are broke but have assets and other means through which they can collect their money and so China is not a believer of forgiving debts.”
The Bolgatanga Central lawmaker further bemoaned Ghana’s insignificant progress in achieving debt sustainability though the government had decided to conduct its infamous domestic debt exchange programme in hope of reducing the nation’s debt stock.
Dr Cassiel Ato Forson, during a debate on the State of the Nation Address on Friday, explained that the government has not been able to satisfy the financing assurances regarding the bailout which includes the board documents.
With the successful process of the domestic debt exchange programme and the support received from other creditors, Mr Akufo-Addo had been optimistic that Ghana would clinch the US$3 billion bailout from the IMF to improve the country’s economic situation.
“I am confident with the cooperation we’re receiving from members of the Paris Club and the People’s Republic of China, which has sent a delegation from China’s Exim Bank to Accra over the weekend to meet with officials of the Ministry of Finance, we shall be able to go to the board of the fund to conclude finally the agreement by the end of March,” he said.
But the Minority Leader said Ghana is not likely to clinch a deal with the IMF in March and would be lucky to get a deal in April.
“Mr Speaker, our President said on authority that Ghana would get an IMF Board approval by the end of this month, I don’t know who is briefing our President, but Ghana will not be able to get an IMF Board approval by the end of this month because even the board documents are prepared.
“We need to get China to give Ghana financing assurance and that they are ready to take a haircut and China has not agreed.”
