Minority criticizes government over Ghana’s rising debt

Minority criticizes government over Ghana’s rising debt
Source: GNA
Date: 07-06-2019 Time: 08:06:16:am
Cassiel Ato Forson is Ranking Member on Finance Committee of Parliament

The Minority in Parliament has criticised the Nana Akufo-Addo-led administration for its unprecedented level of borrowing which they claim has bloated the national debt.

According to them, the latest report of the Monetary Policy Committee (MPC) of the Bank of Ghana places the current national debt at almost GH¢200 billion as at the end of the first quarter of 2019.

Mr Cassiel Ato Forson, Ranking Member on Finance Committee of Parliament, speaking at a press conference stated that, despite this insatiable appetite for borrowing, President Akufo-Addo’s government does not have any significant capital investments to show unlike his predecessor, former President John Mahama, who invested borrowed funds in major capital projects across all sectors of the economy, from education, health, housing, roads, energy, communications, aviation and transport, among others.

Mr Forson also said the GH¢200 billion national debt represents an increase of about GH¢80 billion in the last two and half years alone, raising the debt to GDP ratio from 56 per cent in 2016 to almost 58%.

“We drew attention to the change since 2016 for three reasons related to the Mahama era. First, there was the promise not to borrow. Second, the NPP has benefited from a 25 per cent bonus or increase in GDP, due to the rebasing exercise. Third, the NPP inherited two additional oil fields (Sankofa and TEN) that have almost tripled output and at an average 60 per cent price increase” he added.

According to Mr Forson at the current exchange rate levels, borrowing alone has given President Akufo-Addo government a staggering $16 billion over the period, which excludes GH¢5.7 billion borrowed under the ESLA Bonds last year.

Mr Forson also noted that the current NPP administration has benefited more in terms of oil revenues received than any other government.

He said the total oil revenues received between 2017 and 2018 and those expected to be received in 2019 currently stands at GH¢12,328,703,024.81.

He said President Akufo-Addo’s government has had more money at their disposal than all other governments and should have done far more than is being done presently.

Mr Forson further stated that the current spate of borrowing threatens to erode the fiscal space provided by the rebasing of the economy started in 2016 and which was concluded in September 2018.

According to him, it is obvious that the President views rebasing as an opportunity to engage in unbridled borrowing aimed at consumption related expenditure.

He said President Akufo-Addo in spite of all the resources available to him has not been able to fulfil most his campaign promises to the people.