The Governor of the Bank of Ghana, Dr. Ernest Addison says the issuance of the 2.25 billion dollars by the ministry of finance in April was necessary to restructure Ghana’s debt.
Taking his turn at yesterday’s National Policy Summit in Accra, the governor said the bond has started yielding positive results due to the restructuring.
“We talked the issue of the reprofiling of the debt and that I think is important. It almost like a chicken and egg situation. You need to in a sense create that fiscal space. That I think we agreed very firmly on that. We have already seen some improvement in terms of the inflation outcomes over the last few months. Also, if you look at the execution of the budget we have seen some improvement in terms of the size of the fiscal deficit.â€
“Fortunately for us, this first quarter in terms of the balance of payment and current account we have also seen some improvement in terms of export. They are doing relatively well. We are seeing stronger growth export so the current account is also moving in the right direction,†he added.
Dr. Addison maintained that restructuring the debt has given government some fiscal space to influence all the macroeconomic indicators as they are already beginning to show signs of stability.
“We have also talked about improvement in the reserves of the central bank which has also brought stability on the side of the exchange rates which also feeds into inflation.â€
The issuance of the bond has come under intense criticism from the minority in parliament leading to petitioning of the United States Securities and Exchange Commission.
Credit: Citibusiness