A former Finance Minister, Seth Terkper, has projected that in the event that the government does not achieve its participation target by February 13, 2023, Ghana may face some economic difficulties.
According to him, the debt exchange programme must be successful to show that the country's debts are sustainable and to achieve its intended support from the
Read full articletarget='_blank' href='/GhanaHomePage/people/person.php?ID=3679'>International Monetary Fund.
He explained in a JoyNews interview that "Debt exchange is linked to the debt sustainability analysis that was done. And it is linked to two factors, 1. it is a pre-condition for us to go to the Board, and 2. the debt exchange is recalibrated with the debt sustainability. because you will notice that the condition of the fund is that we must prove that our debt is sustainable, we are capable of paying our debt."
He, however, added, "Remember the fund itself is going to give us $3 billion. I think that itself is a huge amount of money.
"So if you say that you are not going to pay interest in 2023, or you are going to pay 5% instead of 2021. That itself if the debt sustainability analysis was done before you entered the fund, it will change the situation from what it is today. The more compromises we make, the more the careful calibrations get out of alignment," he explained.
Seth Tekper also hammered on the need for the government to cut its expenditure to show its contribution to solving the country's problems.
He said: "That is where the expenditure I've been talking about comes in. If we cut expenditures to show that we can recover from where we are then that will show that we are capable of paying our debt."
Even though the government has not revealed the current participation rate, the deputy Finance minister hinted that as of February 7, the government had achieved more than 70% of the participation target.
Meanwhile, the final deadline for participation was February 10, 2023.
SSD/BOG
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Seth Tekper is former finance minister
