{"id":1236760,"date":"2022-10-27T22:19:41","date_gmt":"2022-10-27T22:19:41","guid":{"rendered":"https:\/\/www.ghanamma.com\/2022\/10\/27\/mahama-speaks-on-ghanas-economy-video-text\/"},"modified":"2022-10-27T22:19:41","modified_gmt":"2022-10-27T22:19:41","slug":"mahama-speaks-on-ghanas-economy-video-text","status":"publish","type":"post","link":"https:\/\/www.ghanamma.com\/2022\/10\/27\/mahama-speaks-on-ghanas-economy-video-text\/","title":{"rendered":"Mahama speaks on Ghana’s economy [VIDEO & TEXT]"},"content":{"rendered":"

<\/p>\n

Attached below is a LIVE VIDEO<\/strong> of the speech from the event happening at the campus of the University of Professional Studies, Accra.<\/p>\n

BUILDING <\/span><\/span>THE <\/span><\/span>GHANA<\/span><\/span> WE WANT\u00a0<\/span><\/span>AN ADDRESS TO THE PEOPLE OF GHANA\u00a0<\/span><\/span>BY HE JOHN DRAMANI MAHAMA<\/span><\/span><\/strong><\/p>\n

\n

INTRODUCTION<\/strong> <\/span><\/span><\/p>\n

Good evening to you, wherever you are joining us from this evening<\/span><\/span> –<\/span><\/span> <\/span><\/span>a<\/span><\/span>nd, to all who made the time to join us here at the UPSA Auditorium<\/span><\/span> as we talk about \u201cBuilding the Ghana We Want<\/span><\/span>.<\/span><\/span>\u201d<\/span><\/span><\/p>\n

Thank you, <\/span><\/span>Dr<\/span><\/span>.<\/span><\/span> <\/span><\/span>Ato<\/span><\/span> Forson<\/span><\/span>, for the very concise and <\/span><\/span>accurate presentation on the <\/span><\/span>dire economic situation we find ourselves in as a country.<\/span><\/span><\/p>\n

Your presentation has laid bare, the stark and objective<\/span><\/span>,<\/span><\/span> yet depressing reality of our country today, how we got here and the dreadful consequences that it has spawned.<\/span><\/span><\/p>\n

GHANA<\/span><\/span>\u2019S ECONOMIC SITUATION TODAY<\/span><\/span><\/strong><\/p>\n

In the last few years, our economy has lurched from crisis to <\/span><\/span>crisis, ultimately<\/span><\/span> resulting in the <\/span><\/span>most <\/span><\/span>debilitating living conditions in several decades.<\/span><\/span><\/p>\n

Within a space of <\/span><\/span>ten months, our currency, the Ghana Cedi<\/span><\/span>, <\/span><\/span>has depreciated by over 62% against the US dollar which is the highest in recent memory. <\/span><\/span><\/p>\n

Our public debt is projected to hover around GH\u00a2 5<\/span><\/span>22<\/span><\/span> billion by close of this year, with a corresponding debt to GDP ratio of <\/span><\/span>above<\/span><\/span>100%.<\/span><\/span><\/p>\n

The debt service obligation <\/span><\/span>arising from this<\/span><\/span>,<\/span><\/span> <\/span><\/span>is monstrous and<\/span><\/span>,<\/span><\/span> is making it impossible to finance almost all critical sectors of the economy.<\/span><\/span><\/p>\n

The wage bill has gone up due to unbridled recruitment into all sectors of the public service resulting from a poor capacity of the private sector to mop<\/span><\/span>–<\/span><\/span>up the teeming youth graduating from all levels of our educational system.<\/span><\/span><\/p>\n

Worse still, Ghana has been classified as the country with the highest likelihood of debt default<\/span><\/span>,<\/span><\/span> which <\/span><\/span>reflects the multiple downgrades by the international credit agencies. <\/span><\/span><\/p>\n

As it stands, we remain firmly shut out of the international bond market<\/span><\/span>.<\/span><\/span><\/p>\n

Inflation is almost 40% and is set to rise higher. <\/span><\/span><\/p>\n

Amidst contestations about the credibility of the method applied, some <\/span><\/span>finance and economic experts<\/span><\/span> believe that the reported inflation numbers, as with other economic indices<\/span><\/span>,<\/span><\/span> are worse than the published narratives.<\/span><\/span><\/p>\n

Ghana is on record as having the highest food inflation in the world at 122% notwithstanding the much touted but <\/span><\/span>grossly <\/span><\/span>mismanaged Planting for Food and Jobs programme. <\/span><\/span><\/p>\n

We are grappling with treasury bill rates of about 30% as local investors in our financial instruments suffer huge risks associated with lending to government.<\/span><\/span><\/p>\n

We are also <\/span><\/span>experiencing massive<\/span><\/span> reverse capital flows as investors lose what is left of their confidence in our economy and pull out in droves. <\/span><\/span>It is estimated that as much as $ 2 billion have been taken out of our economy by investors who fear the worse<\/span><\/span> since the beginning of this crisis.<\/span><\/span><\/p>\n

Cote D\u2019Ivoire <\/span><\/span>and other neighboring countries have become <\/span><\/span>the latest operational destination for many multinational businesses, while others have pulled out completely from Ghana. <\/span><\/span><\/p>\n

These are <\/span><\/span>not just<\/span><\/span> abstract <\/span><\/span>numbers <\/span><\/span>or <\/span><\/span>vague <\/span><\/span>data<\/span><\/span> constructs. They offer a bird\u2019s eye view of the state of <\/span><\/span>our<\/span><\/span> economy, and <\/span><\/span>translat<\/span><\/span>e<\/span><\/span> into our everyday lives, our daily suffering, and struggles. <\/span><\/span><\/p>\n

They <\/span><\/span>underscore our <\/span><\/span>reality,<\/span><\/span> and the <\/span><\/span>devastati<\/span><\/span>on<\/span><\/span>millions of Ghanaian households<\/span><\/span> are going through<\/span><\/span> today<\/span><\/span>.<\/span><\/span><\/p>\n

Ladies and gentlemen, the daily price increases, unending fuel price adjustments, ever-rising inflation, a fast-depreciating currency, corruption, arrogant and insensitive leadership, and the waste of scarce resources, have combined to make life simply unbearable for the generality of Ghanaians.<\/span><\/span><\/p>\n

Prices of items including everyday medication, salt, gari and <\/span><\/span>cooking <\/span><\/span>oil, are constantly on the rise. <\/span><\/span><\/p>\n

If you do not buy an item at a particular point in time, you are likely to find that the price has<\/span><\/span>significantly<\/span><\/span> increased <\/span><\/span>a few<\/span><\/span> hours later.<\/span><\/span><\/p>\n

The mortgage market is collapsing and is threatening the financial plans of many <\/span><\/span>families<\/span><\/span>.<\/span><\/span><\/p>\n

Mothers suffer heartbreak each day because they cannot afford to feed their children like they used to. <\/span><\/span><\/p>\n

Countless young people with enormous potential are struggling to purs<\/span><\/span>u<\/span><\/span>e their lifelong dreams because of financial problems. <\/span><\/span><\/p>\n

Small entrepreneurs are frustrated as they break their backs to keep their businesses open against great odds. <\/span><\/span><\/p>\n

This is not just <\/span><\/span>an <\/span><\/span>instalment in cyclical hardships, and we should not pretend that it is. <\/span><\/span><\/p>\n

Investments have been lost; <\/span><\/span>b<\/span><\/span>usinesses have been destroyed; <\/span><\/span>t<\/span><\/span>he <\/span><\/span>p<\/span><\/span>harmaceutical sector threatens to increase prices further and <\/span><\/span>are threatening to re<\/span><\/span>–<\/span><\/span>introduce the <\/span><\/span>obnoxious cash and carry system<\/span><\/span>.<\/span><\/span><\/p>\n

People have been struck by sickness<\/span><\/span>es <\/span><\/span>and<\/span><\/span> are unable to <\/span><\/span>seek medical attention, due to prohibitive costs and r<\/span><\/span>egrettably<\/span><\/span> some <\/span><\/span>have paid the ultimate price with their lives. <\/span><\/span><\/p>\n

The <\/span><\/span>standard of living, purchasing power, life savings and quality of life of the ordinary Ghanaian is depreciating by the day.<\/span><\/span><\/p>\n

M<\/span><\/span>any are terrified that tomorrow may be worse<\/span><\/span>as they grapple with uncertainty<\/span><\/span> of our current situation<\/span><\/span>.<\/span><\/span><\/p>\n

The signs of this crisis have been there since 2018 when alarming increases in our public debt levels and huge expenditure overruns became apparent.<\/span><\/span><\/p>\n

The NDC did not keep quiet when it became obvious<\/span><\/span> that we were heading for a ditch<\/span><\/span>.<\/span><\/span><\/p>\n

We spoke<\/span><\/span> up<\/span><\/span>. We advised government. We made suggestions. I even asked <\/span><\/span>government <\/span><\/span>to desist from <\/span><\/span>the <\/span><\/span>creative accounting through which <\/span><\/span>Finance Minister <\/span><\/span>Ken Ofori Atta was <\/span><\/span>selective in presenting budget data and thereby c<\/span><\/span>reat<\/span><\/span>ing<\/span><\/span> a <\/span><\/span>picture that was <\/span><\/span>rosy <\/span><\/span>but <\/span><\/span>far removed from reality.<\/span><\/span><\/p>\n

All these fell on deaf ears<\/span><\/span>. <\/span><\/span><\/p>\n

Government became even more brazen and reckless<\/span><\/span> and took their mismanagement to dizzying heights in the run up to the 2020 elections<\/span><\/span> amidst boastful claims that they were the best managers of the economy<\/span><\/span>. <\/span><\/span><\/p>\n

Immediately after the elections, it became clear that we had been thrown into a bottomless pit of debt, staggering budget deficits and a rapidly deteriorating fiscal position. <\/span><\/span><\/p>\n

The looming disaster at the time required an urgent response.<\/span><\/span><\/p>\n

Even as the crisis deepened earlier this year, we <\/span><\/span>in the NDC <\/span><\/span>beseeched government with <\/span><\/span>many <\/span><\/span>prescriptions<\/span><\/span>,<\/span><\/span> which I articulated at the \u201cGhana <\/span><\/span>at the Crossroads speech\u201d in <\/span><\/span>May<\/span><\/span> this year and urged Government to seek multilateral assistance<\/span><\/span> urgently<\/span><\/span>.<\/span><\/span><\/p>\n

Among others, I <\/span><\/span>also <\/span><\/span>called on President Akufo-Addo to <\/span><\/span>expeditiously<\/span><\/span> convene a national dialogue on the economy at which the best and brightest minds our nation has<\/span><\/span>,<\/span><\/span> c<\/span><\/span>ould<\/span><\/span> huddle <\/span><\/span>together,<\/span><\/span> a<\/span><\/span>nd <\/span><\/span>formulate a robust response to <\/span><\/span>our challenges.<\/span><\/span><\/p>\n

I guess it is too late for that now.<\/span><\/span><\/p>\n

I re-echoed demands by Ghanaians that the finance minister and the Chair of the Economic Management Team, who have been primarily responsible for this economic catastrophe, be relieved of their positions to breed confidence among stakeholders and offer the economy a new lease of life.<\/span><\/span><\/p>\n

I asked that the President deploys some of the arsenal in the Presidential toolkit and reshuffle his government to inject innovation and freshness of thinking in<\/span><\/span>to<\/span><\/span> the running of the country<\/span><\/span>.<\/span><\/span><\/p>\n

I also asked that <\/span><\/span>t<\/span><\/span>he <\/span><\/span>President <\/span><\/span>address<\/span><\/span>es<\/span><\/span> the nation <\/span><\/span>to inform <\/span><\/span>the <\/span><\/span>public <\/span><\/span>of the specific steps <\/span><\/span>he was intending to take <\/span><\/span>to weather th<\/span><\/span>e pending\u00a0<\/span><\/span>economic storm<\/span><\/span>. <\/span><\/span><\/p>\n

This address was meant to calm the anxiety of the investor community and <\/span><\/span>rally Ghanaians behind any such efforts.<\/span><\/span><\/p>\n

Regrettably, the President dug<\/span><\/span>–<\/span><\/span>in <\/span><\/span>and failed to do any of these.<\/span><\/span><\/p>\n

Let me<\/span><\/span> note that<\/span><\/span>, since this event was advertised, I have been made aware that the President intends <\/span><\/span>to address the nation sometime this weekend.<\/span><\/span><\/p>\n

It is my <\/span><\/span>prayer<\/span><\/span> that his words would strike the right chords in the hearts of Ghanaians.<\/span><\/span><\/p>\n

Since my speech in <\/span><\/span>May,<\/span><\/span> <\/span><\/span>the situation has spiraled out of control and the effects have been calamitous for all of us.<\/span><\/span><\/p>\n

T<\/span><\/span>he temptation<\/span><\/span> to say \u201cI told you so\u201d may be strong, <\/span><\/span>but <\/span><\/span>we do not believe that this is the time for vainglorious pursuit of <\/span><\/span>vindication,<\/span><\/span> and neither is there any room for gloating.<\/span><\/span><\/p>\n

Even now, a<\/span><\/span>s Ghanaians continue to suffer<\/span><\/span>,<\/span><\/span>the<\/span><\/span>re is a desperate effort to shift blame<\/span><\/span>.<\/span><\/span><\/p>\n

In almost robotic fashion, <\/span><\/span>Government and its hirelings <\/span><\/span>recite <\/span><\/span>in unison<\/span><\/span>,<\/span><\/span> <\/span><\/span>that we are at this perilous juncture <\/span><\/span>only <\/span><\/span>because of COVID-19 and the Russia<\/span><\/span> \u2013 <\/span><\/span>Ukrain<\/span><\/span>e<\/span><\/span> conflict<\/span><\/span>,<\/span><\/span> despite overwhelming evidence to the contrary.<\/span><\/span><\/p>\n

In <\/span><\/span>fact, because of COVID-19, this government received more than <\/span><\/span>a <\/span><\/span>$6 billion<\/span><\/span> windfall<\/span><\/span> from both domestic and external source<\/span><\/span>. <\/span><\/span><\/p>\n

B<\/span><\/span>ut for the deep hole in our finances and the reckless <\/span><\/span>election 2020 <\/span><\/span>expenditure<\/span><\/span>, <\/span><\/span>this should have been sufficient to protect Ghanaians against the disease and promote post-pandemic economic recovery.<\/span><\/span><\/p>\n

There has been a desperate<\/span><\/span> <\/span><\/span>attempt <\/span><\/span>at<\/span><\/span> \u201cpolitical <\/span><\/span>equaliz<\/span><\/span>ation\u201d<\/span><\/span> <\/span><\/span>by <\/span><\/span>propagandists<\/span><\/span> and supporters of th<\/span><\/span>e <\/span><\/span>Government <\/span><\/span>\u2013 <\/span><\/span>claiming <\/span><\/span>that all political parties are the same. <\/span><\/span><\/p>\n

Subtly<\/span><\/span>,<\/span><\/span> they are attempting to suggest that no other person could have done better; or that all political parties in Ghana cannot be differentiated ideologically. <\/span><\/span><\/p>\n

For the avoidance of doubt, we in the NDC will not <\/span><\/span>have dared been as reckless, nor would we have been allowed to be as <\/span><\/span>irresponsible in the handling of the public purse and the nation\u2019s resources as the NPP has been. <\/span><\/span><\/p>\n

We<\/span><\/span>\u2019<\/span><\/span>ve had our own set of challenges in government but nothing we did, or the outcome thereof, <\/span><\/span>has co<\/span><\/span>me anywhere close to the disaster unfolding before our eyes today.<\/span><\/span><\/p>\n

To be clear, we are in this mess because <\/span><\/span>an untouchable <\/span><\/span>f<\/span><\/span>inance <\/span><\/span>m<\/span><\/span>inister<\/span><\/span>, relying on his <\/span><\/span>Databank <\/span><\/span>workers, and<\/span><\/span> neglect<\/span><\/span>ing<\/span><\/span> <\/span><\/span>the <\/span><\/span>advice of seasoned experts at the Finance Ministry<\/span><\/span>,<\/span><\/span> has been<\/span><\/span> left to<\/span><\/span> run this economy into the ground<\/span><\/span>. <\/span><\/span><\/p>\n

We are in this mess because a so-called <\/span><\/span>\u201c<\/span><\/span>solid economic management team<\/span><\/span>\u201d<\/span><\/span> over the <\/span><\/span>last few <\/span><\/span>years, has been <\/span><\/span>unable to call the President\u2019s cousin to order when he embarked on a reckless borrowing spree, indiscriminate closure of indigenous banks and financial institutions, and creative presentation of economic statistics to make <\/span><\/span>our<\/span><\/span> situation look rosier than the reality.<\/span><\/span><\/p>\n

We are in this mess because <\/span><\/span>we have a Pres<\/span><\/span>ident who <\/span><\/span>fails to take responsibility and has instead left the nation on autopilot in the hands of bungling ministers <\/span><\/span>who <\/span><\/span>he describes as \u201cexcellent\u201d.<\/span><\/span><\/p>\n

Last December the President is on record as having said the present economic mess is not his fault.<\/span><\/span><\/p>\n

For <\/span><\/span>emphasis, the<\/span><\/span> biggest blame for the current tragic situation with our economy lies with the very people charged with managing the country\u2014not with the pandemic, not with the war\u2014 our country <\/span><\/span>has been <\/span><\/span>unprofessionally, <\/span><\/span>and Ghana has been <\/span><\/span>treat<\/span><\/span>ed<\/span><\/span> like <\/span><\/span>an<\/span><\/span> experimental playground<\/span><\/span> and <\/span><\/span>a <\/span><\/span>family heirloom.<\/span><\/span><\/p>\n

And I regret to say, this was all avoidable.<\/span><\/span><\/p>\n

Things could have been <\/span><\/span>different, <\/span><\/span>and I remain very convinced they <\/span><\/span>could. <\/span><\/span><\/p>\n

Ladies and gentlemen, I want to re-state what I have said over the years \u2013 we are ever ready and willing to share pragmatic steps that will help put our nation back on track. <\/span><\/span><\/p>\n

Ideally, backroom channels of communications should exist <\/span><\/span>between <\/span><\/span>the ruling party and th<\/span><\/span>e<\/span><\/span>opposition to allow for exchange of views on important matters to the benefit of Ghanaians.<\/span><\/span><\/p>\n

Unfortunately, that has not been the case under this government for which reason we in the NDC are compelled <\/span><\/span>mostly <\/span><\/span>to engage the people of Ghana directly on some of the things we believe ought to be done to mitigate the untold suffering of our people and get the economy back on track.<\/span><\/span><\/p>\n

Even though Government <\/span><\/span>has <\/span><\/span>requested for an IMF programme, the lateness of the decision and the extent of economic decay means an early approval of <\/span><\/span>a<\/span><\/span> Fund pr<\/span><\/span>ogramme could <\/span><\/span>prove elusive<\/span><\/span>. <\/span><\/span><\/p>\n

It may take a couple more<\/span><\/span> months before an agreement is reached on a programme with the Fund. <\/span><\/span><\/p>\n

In the meantime, there is the need to stem the rapid decline in the economy and reduce the unbearable hardships Ghanaians are facing. <\/span><\/span><\/p>\n

I<\/span><\/span>t is for this reason, that I intend<\/span><\/span>, today, to dwell more on solutions as the state of the economy and its fallouts are well known to all of us.<\/span><\/span><\/p>\n

SAV<\/span><\/span>ING<\/span><\/span> GHANA <\/span><\/span><\/strong><\/p>\n

We <\/span><\/span>have <\/span><\/span>already <\/span><\/span>put out<\/span><\/span> <\/span><\/span>an eleven-point proposal that could have arrested the decline before we got to this critical point. <\/span><\/span><\/p>\n

Many of those proposals outlined in my <\/span><\/span>\u2018<\/span><\/span>Ghana at the Crossroads<\/span><\/span>\u2019<\/span><\/span> speec<\/span><\/span>h <\/span><\/span>are <\/span><\/span>still <\/span><\/span>relevant and can be implemented, even if belatedly, to help address the problems we face.<\/span><\/span><\/p>\n

Many m<\/span><\/span>onths after <\/span><\/span>government reluctantly <\/span><\/span>request<\/span><\/span>ed for a<\/span><\/span>n IMF program<\/span><\/span>me, it has <\/span><\/span>failed to <\/span><\/span>coordinate<\/span><\/span> and <\/span><\/span>communicate any<\/span><\/span> <\/span><\/span>credible Home-Grown Plan for consideration by the <\/span><\/span>Fund<\/span><\/span> and the Ghanaian people.<\/span><\/span><\/p>\n

When we approached the IMF for a program<\/span><\/span>me<\/span><\/span>in 2015, we did so only after putting together a robust Home-Grown Program<\/span><\/span>me,<\/span><\/span> which the IMF adopted <\/span><\/span>almost <\/span><\/span>entirely<\/span><\/span>,<\/span><\/span> save for minor addition<\/span><\/span>s<\/span><\/span>.<\/span><\/span><\/p>\n

Ladies and gentlemen, t<\/span><\/span>he immediate causes of the economic disaster we face are <\/span><\/span>the <\/span><\/span>unacceptably high public debt occasioned by a reckless borrowing binge<\/span><\/span>,<\/span><\/span> and an exceptionally large budget deficit<\/span><\/span>,<\/span><\/span> arising out of over expenditure.<\/span><\/span><\/p>\n

These two problems <\/span><\/span>\u2013 debt and deficit \u2013 <\/span><\/span>have undermined confidence in the economy<\/span><\/span> <\/span><\/span>and<\/span><\/span>created very serious <\/span><\/span>solvency<\/span><\/span> problems for government<\/span><\/span>. <\/span><\/span><\/p>\n

This has set us<\/span><\/span> <\/span><\/span>up <\/span><\/span>on <\/span><\/span>a vicious cycle of debt and <\/span><\/span>even <\/span><\/span>more debt.<\/span><\/span><\/p>\n

Tackling the<\/span><\/span>se <\/span><\/span>twin <\/span><\/span>challenges <\/span><\/span>would mark the beginning of <\/span><\/span>the <\/span><\/span>much<\/span><\/span>–<\/span><\/span>needed recovery. <\/span><\/span><\/p>\n

We note that <\/span><\/span>some <\/span><\/span>discussions are <\/span><\/span>reported to have been negotiated <\/span><\/span>between government and stakeholders on a domestic debt restructuring plan as part of <\/span><\/span>the <\/span><\/span>preconditions to secure an IMF program<\/span><\/span>me<\/span><\/span>. <\/span><\/span><\/p>\n

This simply means that after mismanaging the economy and creating this crisis, Ghanaians and others who have invested their hard-earned money in government bonds and other instruments <\/span><\/span>or executed contracts and supplie<\/span><\/span>s<\/span><\/span>awaiting payment, <\/span><\/span>will be asked to forfeit part of the interest due them and a significant part of the principal when it falls <\/span><\/span>due,<\/span><\/span> or arrears owed them.<\/span><\/span><\/p>\n

This is <\/span><\/span>a most unfair and unjust proposition.<\/span><\/span><\/p>\n

It is not fair for innocent people, investors, and business owners to lose their investments, when those who took the decisions and whose incompetence and mismanagement ha<\/span><\/span>ve<\/span><\/span>brought us to this situation, are <\/span><\/span>not only <\/span><\/span>still at post,<\/span><\/span> but are praised and protected by the President.<\/span><\/span><\/p>\n

The President must not only replace the <\/span><\/span>finance minister<\/span><\/span>, <\/span><\/span>he<\/span><\/span> must also reconstitute and take control of the Economic Management Team himself.<\/span><\/span><\/p>\n

I have noted the recent draft motion of censure by the Minority against the Minister and the recent rebellion of the G<\/span><\/span>roup of <\/span><\/span>95 Majority members calling for the removal of the Minister. <\/span><\/span><\/p>\n

I have also noted the statement by the Majority Leader of a compromise reached that the Minister will leave after he has completed the budget and IMF negotiations. <\/span><\/span><\/p>\n

I think this is untenable. <\/span><\/span><\/p>\n

Budget preparation and IMF negotiations are the result of teamwork, not the work of one individual. I fail to see how the <\/span><\/span>absence <\/span><\/span>of the Minister will affect the preparation of the budget or the negotiations with the <\/span><\/span>Fund. <\/span><\/span><\/p>\n

There surely must be persons with the requisite experience to carry on this work. Afterall what happened to the \u201cWe have the men\u201d mantra? \u00a0<\/span><\/span><\/p>\n

For us in the<\/span><\/span> NDC, o<\/span><\/span>u<\/span><\/span>r position is that any<\/span><\/span> debt restructuring must not place the absolute burden on only the domestic debt. <\/span><\/span><\/p>\n

Restructuring of our debt must cover both domestic and external debt. <\/span><\/span><\/p>\n

Ghanaians in the last few years have suffered severe erosion of indigenous capital. <\/span><\/span><\/p>\n

The banking sector clean<\/span><\/span>–<\/span><\/span>out led to loss of jobs and erosion of capital of many Ghanaian families and businesses. <\/span><\/span><\/p>\n

Any debt restructuring restricted to cover only domestic creditors w<\/span><\/span>ould lead to a further erosion of local <\/span><\/span>savings and <\/span><\/span>capital and<\/span><\/span> would also severely weaken the Ghanaian banking sector.<\/span><\/span><\/p>\n

BUILDING THE <\/span><\/span>GHANA<\/span><\/span> <\/span><\/span>WE WANT<\/span><\/span><\/p>\n

a) <\/span><\/span>Reducing the public debt, debt service obligations and creating fiscal space<\/span><\/span><\/p>\n

The biggest problem with our economy today is the hu<\/span><\/span>ge<\/span><\/span> size of our public debt<\/span><\/span>,<\/span><\/span> <\/span><\/span>estimated to <\/span><\/span>be around GH<\/span><\/span>\u00a2 <\/span><\/span>5<\/span><\/span>22<\/span><\/span> billion by close of this year. This must immediately be tackled and stopped from growing further. <\/span><\/span><\/p>\n

To achieve this<\/span><\/span>: <\/span><\/span><\/p>\n

1) <\/span>A<\/span><\/span>n immediate moratorium must be placed on all non-concessional <\/span><\/span>borrowing.<\/span><\/span><\/p>\n

2) <\/span>Government must actively canvass our bilateral partners for <\/span><\/span>more concessional <\/span><\/span>financing <\/span><\/span>and grant<\/span><\/span>s.<\/span><\/span><\/p>\n

3) <\/span>T<\/span><\/span>here must be a stop to <\/span><\/span>Central Bank financing of <\/span><\/span>government<\/span><\/span> above the 5% <\/span><\/span>threshold<\/span><\/span>.<\/span><\/span> <\/span><\/span>The <\/span><\/span>current <\/span><\/span>printing <\/span><\/span>of money <\/span><\/span>to finance Government\u2019s deficit is further fueling inflation<\/span><\/span>. <\/span><\/span><\/p>\n

4) <\/span>G<\/span><\/span>overnment must <\/span><\/span>stop<\/span><\/span> collateralizing statutory funds for the purpose of taking on more loans. Th<\/span><\/span>e<\/span><\/span> wanton collateralization has <\/span><\/span>been unhelpful<\/span><\/span>. <\/span><\/span><\/p>\n

It has<\/span><\/span> limit<\/span><\/span>ed<\/span><\/span> <\/span><\/span>the financial space<\/span><\/span> of the statutory funds, including <\/span><\/span>GETFund<\/span><\/span>, and the District Assemblies Common Fund. <\/span><\/span><\/p>\n

Government should <\/span><\/span>de-securitize these funds and add them onto the <\/span><\/span>public<\/span><\/span> debt as part <\/span><\/span>of the discussions on <\/span><\/span>debt <\/span><\/span>rest<\/span><\/span>ructuring<\/span><\/span>. <\/span><\/span><\/p>\n

We estimate that if the proceeds due ESLA, <\/span><\/span>GETFund<\/span><\/span>, Road Fund <\/span><\/span>etc., a<\/span><\/span>re freed of the <\/span><\/span>burden of <\/span><\/span>collateralization<\/span><\/span> <\/span><\/span>and IPP payments <\/span><\/span>are <\/span><\/span>renegotiated, government would have access to a total of <\/span><\/span>about <\/span><\/span>GH<\/span><\/span>\u00a2<\/span><\/span> 16 billion in 2023, GH<\/span><\/span>\u00a2<\/span><\/span> 17.6 billion in 2024 and GH<\/span><\/span>\u00a2<\/span><\/span>19.4 billion in 2025 from these funds<\/span><\/span> alone<\/span><\/span>. <\/span><\/span><\/p>\n

This would significantly ease the <\/span><\/span>cash-crunch<\/span><\/span>,<\/span><\/span> which has crippled many sectors resulting in government\u2019s inability to meet such basic obligations as supplying food to secondary schools and providing textbooks for basic schools.<\/span><\/span><\/p>\n<\/div>\n