The Vice President has dismissed assertions the government has increased Ghana’s debt by $2.25 billion in three months.
If anything, Dr Mahamudu Bawumia said the $2.25 billion bond issued has rather gone to reduce Ghana’s suffocating debt profile.
The country at the end of 2016 was indebted to the tune of Ȼ122 billion with a fiscal deficit of close to 9%.
The poor macro-economic indices have made it difficult for the new government to fulfill its promises.
Speaking at a Town Hall on the 100 days of the Akufo-Addo tenure as president, a programme organised by Joy News, the Vice President said the amount borrowed is a new strategy of re-profiling Ghana’s debt.
Explaining what the strategy is, the Vice President said the government is only “replacing more expensive debts with less expensive ones.”
Describing the strategy as the “deal of the year,” Dr Mahamudu Bawumia said a bond was issued worth $2.25billion for investors to buy cedi denominated bonds as part of the re-profiling.
“Many people didn’t understand the transaction and thought that we have gone to borrow $2 billion to add to Ghana’s debt. No! we are actually replacing more expensive debt with less expensive debt and elongating it and making it better for this country,” he said.
This, he believes, will keep Ghana’s debt profile in check as the government works to improve the macroeconomy.
In outlining what he said to be “103 achievements in 100 days” the Vice president said the focus of the Akufo-Addo government was to move away from an economy focused on tax, to one focused on production.
As a result, taxes were either scrapped or reduced to create space for the private sector to be able to produce more to keep the economy running.
Dr Bawumia said the government is on track with the economy and will reduce the budget deficit to 6.5% from close to 9% at the end of 2016.