Seth Emmanuel Terkper, Former Finance Minister of Ghana has accentuated the need for Ghana work with speed in order to conclude on its debt cancellation agreement with China, to enable the country secure a program with the International Monetary Fund (IMF) by second quarter of this year.
Speaking in an interview, the Former Finance Minister, said government must work with speed to enable Ghana join other countries secure a deal with the IMF during the Spring meetings in Washington D.C by April.
“I think we should bear in mind the need for us to come to some agreement in the quarters of this external debt exchange negotiations of latest, maybe I will say it may not be feasible at the end of this month. It is impracticable.
Government of Ghana must work with speed to secure IMF deal by the fall of March
“But if we can get it done at the end of March, at the latest and during the IMF-World Bank spring meetings, get into the final negotiations and nail the coffin on the exchange with the staff-level agreement, gaining assistance, then I think we will be in position third quarter, beginning of second quarter to have the IMF agreement going.”
Seth Terkper
Meanwhile, government has been urged to consider debt re-profiling as an option if China is unwilling to agree to debt cancellation.
Ghana government has been urged to consider debt re-profiling as an option in its negotiations with China
According to Emmanuel Owusu, a Financial Policy Analyst, Ghana is hard pressed with time in securing a board approval from the IMF, hence, government has to double up efforts in ensuring it gets the buy in from its external creditors.
Mr. Owusu’s comments are coming at a time when government’s debt cancellation talks with the Asian country has been postponed to late March.
In the meantime, high-powered delegation from the government is expected to visit China later next month (March) to plead for debt cancellation after His Excellency Nana Addo Dankwa Akufo-Addo, President of Ghana, appealed to the German government to help speak with the Asian economic giant for forgiveness.
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Ghana-China negotiation: Several options are available for Ghana
According to Mr. Owusu, there are several options Ghana can look at in reaching an amicable solution with China.
“Dealing with debt per re-profiling is an option on the table. We can explore that. So there again, what kind of terms are we going to re-profile our debts? Is it going to be some level of partial or some percentage-wise restructuring? Are we going to look at deferring some of the interest payments to a later date? Are our external parties going to tell us that pay ‘x’ amount now and pay ‘y’ amount later?
“All those options are available. So I think we should be able to look at what we can do as a country now and be able to engage and say, okay help us. This is what is on the table for us. Even in the profiling, you have to present options. You probably have to let your external partners know what you can do and what you cannot do.”
