Isaac Adongo, the Member of Parliament for Bolgatanga Central has once again taken on the government for its failed economic policies.
Mr. Adongo in a recent writeup on his Facebook page suggested that the government is ducking the call of investors of its inability to make payments that are due the investors.
The lawmakers also suggested that government had failed to pay heed to wise counsel on reviving the economy. Mr. Adongo, described the Vice President, Dr. Mahamudu Bawumia as an experimental and naive economist and added that it would only take a miracle to save Ghana from defaulting on its loans.
Below is the full write-up.
Hon Isaac Adongo writes;
Pick Calls of Your Investors And Creditors to Calm Their Nerves; Otherwise, Transfer The Calls to Dr Bawumia to Explain To Them How He mismanaged Us Into This Mess.
In recent weeks the Ministry of Finance has been starving investors and creditors of the needed information to guide their economic decisions. It is more likely that this is driven by the lack of a clear narrative about a credible recovery path. Unfortunately, these calls and demands for information cannot be wished away as basic economic behaviour establishes that a widening information asymmetry occasioned by such a deliberate action can only be costly to Ghana in our present and future endeavours with rippling perceived risk and spread effects.
The fears of investors have been even more heightened by the recent revelation by a key influence peddler close to the corridors of power of serious consideration of a “price control” regime, long abandoned by civilized and contemporary economies.
Even before this, the scam proposal to cut the budget by 30% and a further 10% of discretionary expenditure both of which would amount to some Ghc31 billion unnerved investors because it was not meaningful.
Additionally, the promise to raise $2billion to shore up reserves when the approved budget for such sovereign financing in 2022 is just $750 million at a time the doors of the international capital market are closed to Ghana further dampened credibility in government action and thought processes.
No wonder, no cent of the $2billion has arrived with the cedi in tatters and gasping for breath.
In short, the savvy investors do not believe that the Bawumia led team has enough depth, self-conviction and agility to get us out of this self-inflicted mess.
For instance, it is quite clear that the much touted E-levy is proving to be a costly regressive action that is constraining full Fintech innovation yet not providing the relief of massive monetary windfalls that this government trumpeted everywhere. It has been underwhelming, to say the least.
Steps to further worsen rigidities and fiscal risks by attempting to collateralize future proceeds from E-Levy and mineral Royalties with the dubious Agyapa deal scare investors about the future outlook of Ghana’s fiscal sustainability.
Unfortunately, frantic calls by investors and creditors to the Ministry of Finance to get updates and clarity of thought and measures being taken to turn the economy around continue to fall on rocks as the calls are avoided and unanswered.
Key officials at the Ministry who waxed lyrical not long ago about their “skills” in reckless borrowing now appear scared of the same investors they scammed with false and often exaggerated data to get them to part with their hard earned foreign currency while they came back celebrating their cunning luck with Kenkey and fish.
After years of refusing to heed my advice to conserve our FOREX reserves to build resilience for future headwinds, the Governor of the Bank of Ghana recently gave a grim account of a failed monetary stance under his leadership.
He finally concluded that Ghana’s loss of the capital markets to raise the now familiar reckless annual $3billion eurobond borrowing for Databank and others to earn huge fees for the Finance minister, coupled with high sell off of non resident bond holders’ interest in the domestic market in response to the record-high inflation which an American Economics professor aptly estimated to be 45%, and a collapsed cedi, has led to the loss of a large chunk of Ghana’s net international reserves.
In Dr Addison’s own words, Ghana faces elevated levels of external Vulnerability without reserve cover and is ill-prepared to contain it.
The end result is that the Governor fell short of pressing further panic buttons of self-destruction by throwing his hands in the air in despair.
The same Governor recently admitted his fight against inflation has been a ‘trial and error’ when he said Ghana’s inflation appears complex to him. This is after five years as a Governor and rather thinks the solution to this ‘livelihood wiping off inflation’ requires a national roadshow to take all Ghanaians to the classroom to teach us what inflation is. Obviously so we are better prepared to accept our plight that inflation today has no solution because it’s complex and only requires us to understand it so we don’t expect him to deal with something that is beyond him.
Unfortunately, Dr Bawumia whose naive experimental economic policies and Ghana’s star catastrophic Economist is busy googling the internet to download and learn how to install computer software applications packages while the economy deteriorates.
Please, if you are scared to face questions from the people you scammed with some bizarre, and baseless projections, to take their monies, transfer the calls to the demystified economic trickster who has badly damaged our economy and our collective existential future to answer and account for his messy strong fundamentals.
Ghana is in dire need of credible leadership devoid of arrogance in the face of badly sinking ship. Ghana’s default outlook is scary and already rated by the CFR sovereign risk tracker amongst the top 10 worse-performing countries in the world, some of whom are already defaulting nations with Sri Lanka, our newfound peer facing Ghana’s historic economic melt down between 1979 and 1983 scenario.
Between July -September 2022, Ghana needs a miraculous fighting chance to avoid default in paying our offshore interest liability if we still can’t borrow large sums of forex loans in the face of the twin challenge of low revenue performance and record low international reserves to fund these offshore obligations.
Under the circumstances, the way out is for Ghana to initiate steps to engage investors and creditors for debt and interest payments restructuring.
To achieve this in the face of our badly damaged credibility and lack of workable strategy will be a daunting task. The consequences of default will hurt and haunt the economy for decades after these clueless managers like Dr Bawumia are dead and have become historic dishonourable ancestors.
To pull this off, Ghana requires a strong hand in the room with a dreaded cane who these investors trust to engage.
Now that they are in clutches, their badly bruised ego and arrogance notwithstanding, the need to find that strong hand without further delay to assist use his/her compelling influence to get investors and creditors to the table to save our economy and country is the more urgent.
The arrogance and non existent narrative and empty tough talking of a proud sovereignty without substance must give way to the supreme interest of God and Country.
You have badly damaged our sovereignty which is now worth nothing to investors and creditors.
To save our dear country from further embarrassment and international ridicule, pick the calls of the investors whose $12 billion Eurobonds you borrowed and came to eat kenkey and fish or direct the calls to your misfiring economic maestro, Dr Bawumia the Walewale Adam Smith.
Source: A1radioonline.com|101.1MHz|Mark Kwasi Ahumah Smith|Ghana