Hon. Ken Ofori Atta, Finance Minister of Ghana, on behalf of government has made a final presentation to its creditors in 20 developed countries to help fast track the cancellation of the country’s debts.
The presentation was done to the Paris Club of International Creditors and was aimed at making a strong case to these 20 developed countries under the permit of the Paris Club of International Creditors that Ghana deserved a debt cancellation. That is, looking at the current state of the economy and what government intends to do with the reliefs.
There were several scenarios that were presented to these creditors and why there is the need to fast track the negotiations.
It appeared government succeeded in making a strong case for these debts to be cancelled as this has led to the Paris Club agreeing to set up a creditors committee – one of the significant steps towards the possibility of having Ghana’s debts cancelled.
Whilst Ghana’s Finance Minister, Ken Ofori Atta wished the process could have moved faster, the Paris Club sees the creditors committee as a significant move and assigned that it is opened towards cancelling Ghana’s debt.
Securing this deal from these creditors may also help fast track Ghana’s International Monetary Fund (IMF) approval from the board before the first quarter of this year.
The IMF again is pushing the private international creditors to join the initiative and cancel Ghana’s debts.
Meanwhile, the Ghanaian cedi’s poor performance has left the nation in a devastated state with many concerned about the fate of the country considering the intense impact the depreciation of the local currency brought on the country in the previous year, 2022.
The Cedi Has The Tendency To Erode Past Made Gains
Making efforts towards addressing the pressure on the cedi, the Association of Ghana Industries (AGI) appealed to government to take steps to address the recent depreciation of the cedi to the dollar, with a caution that, should the trend continue, the gains made during the month of December 2022 could be eroded.
Although the Bank of Ghana is hopeful that the government’s gold-for-oil trade will alleviate economic strain on foreign exchange, businesses are calling for more active measures from the government to stabilize the value of the cedi.
Tseonam Akpaloo, the Greater Accra Regional Chairman of AGI has made it clear in his presentation that all the industry needs is the stability of the cedi.
“We need a regime that allows for stability…that’s what we calling for. Sometimes it goes so down and up. We don’t want that, we want stability.
“We are asking managers of the economy to consider very seriously how they can stabilize the currency. That’s what we need.”
Tseonam Akpaloo
As of today, the Bank of Ghana is reporting an exchange rate of ¢10.351 per dollar on the interbank market, however, the cedi is typically being sold for an average of ¢13 per dollar at the forex bureaus.
