The Association of Ghana Industries (AGI) has affirmed its support for the International Monetary Fund programme to help bring stability to the economy.

It however expressed concern about the Domestic Debt Exchange Programme (DDEP), saying, though it acknowledges that this programme will allow Ghana to gradually reduce its debt-to-Gross Domestic Product (GDP) metrics towards sustainable levels, there are some key challenges that need to be addressed for the DDEP to yield the expected impact.

“The AGI membership constitutes businesses in 23 sectors, including banks, insurance companies and manufacturers across Ghana who play critical roles in the productive sector of the economy and therefore we have strong interest in the implementation of this programmee”, it said in a statement signed by its Chief Executive Officer, Seth Twum Akwaboah.

“AGI is concerned that the current state of the programme will impact the liquidity and solvency position of financial institutions and limit their ability to support the real sector of the economy, and this requires maximum attention”, it added.


For liquidity, the AGI said it envisages liquidity constraints the banks will face under the DDEP and its impact on business access to finance, noting, iIt is important to stress that in the wake of potential challenges, the productive sectors of the economy are not denied access to much needed funds to increase their production. In view of this, we welcome Government’s intention to establish the Ghana Financial Stability Fund (GFSF) to provide liquidity support”.


On Solvency, it said the current structure of the DDE Programme will not only impact liquidity and profitability of the financial institutions but more importantly on their solvency as a result of huge impairment losses on their balance sheet.

“These economic losses will potentially erode the capital of our financial institutions and affect their going concern status”, it added.

Access to finance

Regarding access to finance, the AGI said industrialisation remains the most important engine of economic growth and there is a need to grow local industries to reduce the over-dependency on foreign exchange for imports.

“We believe that as the financial sector goes through this turmoil, access to funds particularly for the productive sectors would be affected. This will worsen the perennial difficulties encountered by the business community in accessing finance for their operations. The AGI is therefore urging government and all stakeholders to consider this challenge as an opportunity to support the productive sector of Ghana to produce more of our essential goods and limit reliance on importation to ease pressure on the local currency.”

Government expenditure

Under the current circumstance, AGI said fiscal prudence is crucial to restoring confidence in the economy and therefore a review of government’s expenditure is necessary.

“The budget deficit projection in the 2023 budget statement ought to be reviewed significantly to align with the 5% provision in the Fiscal Responsibility Act. We are confident that an IMF Programme will help instill fiscal prudence that will not warrant the setting aside of the Act. An increase in budget deficit from 7.4% (as of September, 2022) to 7.7% of GDP as contained in the 2023 budget does not inspire confidence among the business community”.

In conclusion, AGI called on government and all relevant stakeholders to see this crisis as an opportunity to introduce reforms that would enhance the development of agriculture and industry on a long-term basis and link it with other productive sectors such as the mining and construction sectors to bolster sustainable growth of our economy.

“We would like to see government’s excessive borrowing from the banks, which tends to crowd out the private sector, become a thing of the past”.

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