Finance Minister Ken Ofori-Atta has stated that the US$3 billion government has borrowed from the international capital market would be used to bring much-needed relief to Ghanaians.
The money, he said, would be applied in various sectors including the continuation of the Free SHS to ensure the government sustains the programme and ensure more students benefit from it.
The Minister stressed that Ghanaians deserve the Free SHS and the amazing economic team the President has composed demonstrates the seriousness of his administration.
Mr. Ofori-Atta disclosed this on Newsfile on Joy News and indicated that the success of the US$3 billion Eurobond has demonstrated the confidence that the Ghanaian economy has received since President Nana Addo Dankwa Akufo-Addo assumed power.
The bond, which was issued for US$3 billion, was oversubscribed with the government receiving US$15 billion response from the international capital market at what he said is the lowest rates in the country’s history.
Responding to what this money should mean to the market woman and ordinary Ghana the Finance Minister noted that heavy burden about the fluctuation of Ghana’s exchange rate will be addressed.
The government, he said, is consolidating the foreign exchange reserve of the state thereby ensuring the stability of the Ghanaian cedi.
He said, “Certainly for the market, woman food prices will be great and the children could still go to school.”
“It means if your child is in school the Free SHS will continue. We can continue to fund it.”
“NHIA will continue to be better and that is good for us and interest rates are gingerly coming down and that hopefully will give us bank credit.”
The Minister defended the government’s borrowing and argued it is a necessity for the country to translate its economy to export-driven from imports.
He pointed out that Ghana’s domestic revenue is not enough to fund the government’s economic programmes hence borrowing ensures the economic architecture of the country is transformed towards manufacturing.
Mr. Ken Ofori-Atta dispelled fears that the country is edging closer to being classified as a high debt distressed country as warned by a report from the International Monetary Fund (IMF).
Ghana’s public debt as at September 2019 was GH¢208.6 billion, equivalent to 60.3 percent of the country’s gross domestic product (GDP).
The Finance Minister, however, argued issues being raised by the IMF is not for government to stop borrowing but to ensure smart and careful borrowing.
Addressing the banking sector clean-up and the promise to pay locked-up funds of depositors, he admitted that though this has not been captured in the budget, once President Akufo-Addo has made the promise the Ministry will find the resources to fulfill this pledge.
According to him, the asset quality review from the Bank of Ghana had indicated where the banking system was headed to but there had been no courage to make a decision.
President Akufo-Addo, he said, made that decision which has witnessed different reactions from the public.
He stated that the government is expected to spend about GH¢16.28 billion to refund lost investments to depositors and stressed the President is determined to go through with the promise to ensure every depositor is paid.
