Gov't hopes to pay ¢10 bn energy debt by first quarter of 2018

Gov't hopes to pay ¢10 bn energy debt by first quarter of 2018
Source: Ghana|Myjoyonline.com
Date: 27-11-2017 Time: 07:11:08:pm

Government has targeted to clear the 10 billion cedis energy sector debt by the first quarter of 2018.

Success on the part of government will help resolve the liquidity challenges facing some of the banks and further stimulate investment into the sector.

President Akufo Addo who announced this said the energy sector bond issued recently forms part of a long term strategy to address the issue.

He was speaking at a programme to induct into office the governing board of the public utilities regulatory commission.

The energy sector debt has been a major issue of concern to the government.

The previous government suffered a crippling power crisis in the best part of its administration, a challenge some believed may have caused them the 2016 elections.

One of the campaign promises of the then opposition New Patriotic Party was to fix the energy sector challenges, particularly the stifling debts.

Months after being elected into office, the president Nana Akufo-Addo said he would not renege on that promise.

“Government over the last ten months has ensured that the supply and distribution of electricity have improved.

“We have successfully issued 4.7 billion cedis in seven and ten year bonds to settle a portion of the 10 billion cedis debt overhung we inherited in the energy sector.

“It is our anticipation that the remainder of the debt will be settled by the end of the first quarter of 2018,” he said.

He believed that will help in solving some of the liquidity challenges faced by the banks.

Chairman of the PURC board, Michael Opam said the commission will ensure greater operational efficiency to clear the debt.

“We will uphold the key pillar of the Commission which is the onerous task of balancing the interest of investors and consumers in the electricity, natural gas and water sectors," he stated.

He said their focus will as well be on the legacy debt in the energy sector and demand greater operational efficiency by the utility companies.

Meanwhile, the ranking member on the Mines and Energy Committee of Parliament Adam Mutawakilu said government’s steps in resolving the legacy debt is conflicting.

He said the 4.7 billion cedis bond was for five years and wondered how proceeds from a five year bond would be used to pay debts within a period of six months.

He doubted if government will be able to settle the debts by the first quarter of 2018 and charged the government officials to explain the matter a bit further. 

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