Debt Junkie Gov’t Wants US$3bn Rather Than US$1.5bn From IMF

The Akufo-Addo government is seeking to use the IMF program that was expected to provide it an opportunity to start a disentanglement from public debt, to rather seeking to pile on more debt.

A report from Bloomberg, says that the government has doubled the original loan request from the IMF from US$1.5billion to US$ 3 billion.

“Ghana’s government is in talks over a loan of about $3 billion from the International Monetary Fund, according to two people familiar with the matter. The amount is double what the West African nation was considering a month ago as it tries to shore up its finances and win back access to global markets,” Bloomberg wrote.

It is unclear if the IMF will oblige the now-familiar debt greed of the government. But if it does, funding would be provided over three years.

According to Bloomberg, the insiders who leaked the information from the Finance Ministry do not want to be named.

According to the Bloomberg report, the IMF has neither confirmed nor denied the new loan request by the government. A response emailed to Bloomberg by the IMF is said to have said that it was too early to comment on the subject and that the Executive Board of the fund is what ultimately determines the outcomes for Ghana.

The Akufo-Addo government on July 1 announced it was seeking an IMF bailout after the country’s debt became unsustainable and floundered the economy.

On July 6, a team from the IMF arrived in the country and engaged the authorities with the government promising to negotiate a good deal for Ghana.

However, even as the IMF bailout negotiations are ongoing, the economy has been taking hits with the cedi steadily depreciating and becoming the worst performing in the world, while rating agencies downgrade Ghana’s creditworthiness.

On Friday, August 5, American credit rating agency, Standard and Poor’s (S&P) Global Ratings pushed Ghana’s debt further into speculative territory, lowering its foreign and local currency sovereign ratings to CCC+/C from B-/B with a negative outlook.

Even though the government is attempting to blame COVID-19 and the Russian-Ukraine war for the economic collapse, the fact remains that the economy took a massive nose-dive long before COVID-19 and the war, and this was due to rampant corruption and mismanagement that caused the government to pile up public debt to approximately GHC 400 billion currently.

Popular businessman, Dr. Kofi Amoah has lashed out at Finance Minister Ken Ofori-Atta, who tried to claim his particularly poor and corrupt handling of Ghana’s economy has some divine connotations.

Reacting to Ofori-Atta’s claim that only Jesus can tell whether he has handled the economy well or not, Dr. Amoah fired back at the Finance Minister for collapsing scores of banks and financial institutions to allow his personal company, Databank Financial Services to monopolise the financial sector.

“Did Jesus tell you to liquidate Ghanaian-owned banks built with hard work and sacrifices, whilst saving your own Databank to be used in siphoning commissions from the huge loans you contracted for Ghana, which have now sent us to the IMF?”

It would be recalled that Ofori-Atta recently told Parliament that in the period that he has been Finance Minister, his private company, Data Bank, has so far made some US$159.3 million by way of acting as a bond market specialist to the government.

In the details of the corrupt setup, Mr. Ofori-Atta has had his Ministry hire Databank as a book-runner for government bonds.

The blatant conflict of interest corrupt setup persists even after Ofori-Atta’s apparent inspired addiction to borrowing, a situation that has a direct correlation with the rising fortunes of Databank.