Why Ghana’s economy is sitting on time bomb waiting to explode – Pianim

Mr. Kwame Pianim, a well-known economist, said that Ghana's economy is bankrupt. He thinks that the economy is a time bomb that is about to go off.

Mr. Pianim said that this was because of government policies, like the domestic debt exchange program that Finance Minister Ken Ofori-Atta set up.

The government said that under the program, which has been strongly opposed by most Ghanaians, including members of the Individual Bondholders Forum (IBF), individual bondholders would have to agree to a "voluntary" plan to exchange their domestic bonds for new benchmark bonds.

In an interview with TV3's Paa Kwasi Asare on January 11, Mr. Pianim, who is also a founding father of the ruling New Patriotic Party (NPP), said, "For this government to let Ken Ofori-Atta sit in front of Ghanaians and make this proposal...

"If Ken was real, when the Attorney General came with his legal opinion, which in the commonwealth has the force of a high court order, he would have taken this document and gone to the International Monetary Fund" (IMF). If the IMF really told him to do that, I think it's illegal and against the Constitution.

He also said, "Ken Ofori-Atta says, 'Let's do this program,' but it's a bad idea that hasn't been well thought out. Ken is putting a time bomb under the economy with this exchange program. We will have to deal with it for the next 30 to 40 years. It's a ticking time bomb because he's taking billions of Cedis out of the economy.

"T-Bills and government bonds are risk-free, which is why insurance companies and banks are required not to invest in them.

"Ken Ofori-Atta has the bad reputation of being the person who made government bonds no longer risk-free. He will be remembered as the only Minister of Finance who put this country out of business. We are right there."

While this is going on, a group of individual bond holders is getting ready to sue the Government of Ghana because they were included in the debt exchange program even though they were supposed to be exempt.

The group has asked all eligible bond holders to join the class-action lawsuit, which will likely be filed next week.

"This decision and action are wrong, and the Government shouldn't be able to use its power to make Ghanaians poor. We are asking eligible bondholders who want to protect their interests to join the class action by sending them this bulletin," the invitation said.

A few hours after the notice to join was posted on social media, Kwadwo Agyapong, who is in charge of the group, told 3Business that about 50 bond holders had signed up to join the lawsuit.

Credit: 3News