Professor Godfred A. Bokpin, an Economist and Renowned Professor of Finance at the University of Ghana Business School (UGBS), has condemned the Minister for Finance, Ken Ofori-Atta for the poor handling of the International Monetary Fund (IMF) Program so far.
Pensioner Bondholders Forum, a group for the protection of pensioners with investment in government bonds on Monday began picketing at the premises of the Finance Ministry with a call to have them exempted from the Domestic Debt Exchange Program (DDEP).
According to the group, attempts to have their investment exempted from the programme have proven futile, the reason for the picketing at the Finance Ministry until their demands are met.
Commenting on the whole challenges being faced by individuals and associations due to the DDEP initiative, Prof. Bokpin during an interview stated that the finance minster’s bad way of organizing and controlling the program is the end result the country is experiencing. “The deadline is today, and we do not even know the stands of the program,” he lamented.
According to him, the projection towards the end of 2022 was that the government was going to adopt a consensus approach in this debt restructuring.
“Combined with the considerable fiscal adjustment, we would have resolved this by now and probably have an IMF program by now. Without an external anchor you will see stability. We have also seen some stability at the global level.
“So, in terms of imported inflation and all of that, you will see that in moderation. There are those who think that inflation has not seen its worst. So perhaps in terms of elevated prices to the end of the first quarters, yes, we should not be surprised. But it depends on how fast we are able to do some of these things and particularly get an IMF program.”
Professor Godfred A. Bokpin
The Finance Expert indicated that there were some good economic signals on 1st July, 2022, when Ghana made the call to Washington for the IMF support program.
“On the secondary and Eurobond market, the spread on how much our bonds were trading in excess of dollars actually narrowed. That is the kind of credibility the IMF program brings immediately. When the Staff Level Agreement was announced you could see what happened to the cedi right after that.
“So, a lot depends on how quickly we are able to build consensus with everybody. But the approach the Minister of Finance has adopted in itself creates a whole lot of disaffection in seeking for the IMF program. Therefore, it may affect the implementation and acceptability of the IMF program at the end of the day. It is also about strategy and I think it has to be done properly.”
Professor Godfred A. Bokpin
Accept Responsibilities For Economic Frustrations, Let Individual Bondholders Rest
Emphasizing on the finance minister’s inefficiency, Professor Godfred A. Bokpin parried Ken Ofori Attah’s accusations levelled against bondholders for their hesitancy to sign up for the Domestic Debt Exchange Programme (DDEP).
Mr Ken Ofori Atta, while addressing the nation on Monday, February 06, 2022, ahead of the expiration date for the signing on to the DDEP, sought to hold the bondholders responsible should the country fail to achieve her goal.
Reacting to the statement in an interview, Prof. Bokpin argued that the government was the one who applied for an IMF programme and therefore should be held responsible for the consequence.
“We must consciously correct the knowledge that seems to suggest that we collapsed the economy simply because bondholders did not sign up. That does not reflect the reality. That is a lie that is being told and must be corrected.”
Professor Godfred A. Bokpin
According to him, Individual Bond Holders did not apply for an IMF programme, pensioners did not apply for IMF programme, “it was Ghana government that applied for the IMF programme,” he noted.
Having said that, the Professor does not support the call that individual bondholders should sign up for the DDEP.
“I do recognize that a certain level of debt restructuring is inevitable but we are not at the point where we could ask individual bondholders to come to the table because the fiscal fragment that cost the public has not done even the average. Once the fiscal side hasn’t done what it is supposed to do, there is no imperative for us to share disproportionately the burden to individual bondholders or institutional holders”.
“If we don’t correct that now and we coerce our own people, pensioners and the rest of them, we will go through this and probably less than three years there may be the need to restructure our debts again.”
Professor Godfred A. Bokpin
Read More : DDEP: Is Today, February 7, 2023’s Deadline Likely To Be Extended Again?
