Government sacrificing $10 billion for $3 billion IMF bailout – MP

Deputy Ranking Member of the Finance Committee of Parliament, Isaac Adongo, has criticized government for sacrificing $10billion bondholders’ money for $3billion IMF bailout.

This comment comes after the finance minister in a press statement announced that the government has secured more than the needed 80% participation in the (DDEP) as part of key steps to reach board-level approval with the International Monetary Fund (IMF) on a $3 billion facility to restore macroeconomic stability in the country.

Government targeted 80% participation in the program to help restructure 137.3 billion Ghana cedis in bonds on the domestic market to bring its total debt, which stands at about 575.5 billion Ghana cedis to sustainable levels which was a criterion the country must meet to secure a possible $3 billion bailout.

The government expressed gratitude to the people of Ghana for their support throughout these very difficult times and said it will consider inputs made by all stakeholders during the DDEP engagements to further streamline government’s expenditures.

The finance ministry maintained that the exercise was voluntary and thus the right of the individual to self-exempt was never in doubt.

Speaking in an interview on Morning Starr on Starr FM with Francis Abban the deputy ranking member said,” The government is saying, forgo your money so that we can achieve compliance with the internal arrangement of the IMF. So we can get a program that gives us $3 billion and yet the people’s money that you want to use to sacrifice is over $10billion. So, you want to destroy $10billion in order to go and collect $ 3 billion dollars over three years not even one year. These are people’s monies, these are not the government of Ghana money, these are pensioners’ money and these are monies they gave to you on the trust of the sovereign. Now the government says we want to take your money, we won’t give you the money because the economy is in trouble”.

He continued; "So the government says in the budget I have 52 billion of interest payment. 31 billion of that is attributable to Ghanaians that I need to pay them in 2023. I am not going to pay you that money I will pay you zero. I have extended 21 billion that I have to pay to external creditors. I write a letter to them suspending payment I’m not going to pay. The same external creditors, I owe then 22billion that I have to pay this year, I am not going to pay. So, in all, to achieve debt sustainability and be able to qualify for the IMF program, in 2023 alone, 74billion of debt service I am not paying. How can you do this and celebrate as success”.

Ghana hopes to reduce its debt to 55% of Gross Domestic Product by 2028 with the debt operation which involves both domestic and external creditors. The completion of the DDEP puts next engagements with external creditors on a possible debt restructuring.