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Dr. Adongo says there’ll be haircuts on investments depsite President Akufo Addo’s assurance

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The President, Nana Addo Dankwa Akufo-Addo gave the assurance that the government does not intend to slash the returns made on investments as speculated.

President Akufo-Addo gave the assurance when he addressed the nation on Sunday following economic challenges currently confronting the country weeks ago.

“I also want to assure all Ghanaians that no individual or institutional investor, including pension funds, in Government treasury bills or instruments will lose their money, as a result of our ongoing IMF negotiations. There will be no “haircuts”, so I urge all of you to ignore the false rumours, just as, in the banking sector clean-up, Government ensured that the 4.6 million depositors affected by the exercise did not lose their deposits,” he added.

Development Economist, Dr. Michael Adongo doesn’t believe in the President’s assurance. 

“The President was only reading a speech prepared for him by his friends and family. I think that no one who understands our economy can say that we won’t go through haircuts. We’re looking at domestic debt alone of over 19 billion dollars and we are looking for 3 billion dollars from the IMF. There is no way we can come out of this without restructuring in any way. Anytime any government appointee or government communicator for that matter tells you that we can get this IMF deal, achieve debt sustainability, demonstrate our ability to manage our debt, without going through some form of debt restructuring, is only deceiving Ghanaians,” he said. 

Dr. Adongo added that the only way the country can get through without restructuring is when the IMF doesn’t demand that the country show its debt sustainability strategies; a condition he explains, is highly improbable.

The Economist explained that if Ghana is pushed to show debt sustainability strategies, it would cause severe discomfort for the people of the country but it would position the country on a track of progress. 

“I would want the IMF to pursue that cause to give us the opportunity to grow. I am going to put this on record here that debt restructuring would damage this economy beyond repair. It would lengthen the time Ghana would take to recover. If I am the IMF and really have the interest of supporting Ghana’s debt recovery, we must agree that Ghana cannot be debt sustainable in the short to medium term and therefore, we should put in measures that would control government spending, government budget and still grant some concessionary loans and allow them [Ghana] rejuvenate the economy.” he said. 

Government is currently seeking a $3 billion economic recovery support from the International Monetary Fund (IMF).

Earlier, Dr. Adongo who strongly supports the push for the Finance Minister, Ken Ofori Atta to lose his job cautioned against using Ken Ofori Atta as a scapegoat.

When Dr. Adongo spoke on A1 Radio’s Day Break Upper East Show, he opined that the basis for the sacking of the Minister should not be on situations that have been allowed to slide under previous ministers in his position.

“One thing that stood out for me was the attempt to pin the use of resources on the Finance Minister without recourse to Parliament. Yes, it is a brazen disregard for Parliamentary proceedings but on this one, I would like to tread on a path of caution because it is a practice that previous Finance Ministers have been doing and I do not want us to use this one as an excuse to take the Minister away.”

Source: A1radioonline.com|101.1MHz|Mark Kwasi Ahumah Smith|Ghana

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