According to Richmond Atuahene, a banking consultant, Ghanaians would pay back the loans that the government was taking out at exorbitant rates.
He claimed that Ghanaians are ‘paying through the nose’.
In order to prevent the government’s borrowing from going overboard, Mr. Atuahene has suggested strategies for controlling it.
He proposed that Ghana revise its 1992 Constitution to impose a limit on the government’s borrowing practices, similar to the USA, where the administration petitions Congress for permission to borrow more than the limit is set.
Dr. Atuahene made these remarks during the 12th edition of the Ghana Economic Forum, currently taking place in Accra, under the theme “Building Back Better: IMF Support, Strategies to Build a Sustainable Economy, and a Dynamic Business Environment.” He said “Ghana as a country, must from today, begin to look at the constitution. Inside the constitution, according to literature from IMF, the United Nations in 2014, the debt to GDP of any developing country should not exceed 50 percent and developed countries are given a leeway of 60 percent.
“We find ourselves in this position because we have a constitution that has no business of setting a debt cap like the Americans have it. When the Americans had the cap and they had trouble they had to go to Congress and when they go to Congress you will see how they suffer. So we need to come to the constitution and amend it as soon as possible. “This is one of the shortest strategies that I will recommend so that we don’t find ourselves in such a situation ever again, borrowing and borrowing for consumption. As I have always said, you will pay through the nose, and Ghanaians repaying through the nose.”
Ghana is currently facing an economic crisis that has compelled the government to seek an a $ 3 billion bailout from the International Monetary Fund (IMF), a bailout which has been approved with the first disbursement of $600million made to the country. Public debt, which excludes state-owned enterprises obligations, rose to 569.3 billion cedis ($49.7 billion) at the end of April, the Bank of Ghana said on its website. The figure was adjusted to include the central bank’s overdraft to the government, which was securitized in December 2022. The government received flak for excessive borrowing.
Ghana is currently facing an economic crisis that has compelled the government to seek an a $ 3 billion bailout from the International Monetary Fund (IMF), a bailout which has been approved with the first disbursement of $600million made to the country. Public debt, which excludes state-owned enterprises obligations, rose to 569.3 billion cedis ($49.7 billion) at the end of April, the Bank of Ghana said on its website. The figure was adjusted to include the central bank’s overdraft to the government, which was securitized in December 2022. The government received flak for excessive borrowing.
