A Member of Parliament’s Finance Committee, Kwaku Kwarteng has said government has been exposed by the International Monetary Fund’s (IMF) recent announcement that Ghana’s true debt to GDP ratio is 71% and not 55%.
Sanjeev Gupta, Deputy Director, Fiscal Affairs Department for the IMF said at the Fiscal Monitor Report briefing in Washington on Wednesday, that “the debt-to-GDP ratio in Ghana is 71%, not 60%; so it is much higher than you mentioned,” he clarified.
This is contrary to the figures the Monetary Policy Committee of the Bank of Ghana released after examining the health of the economy at the end of June 2014.
Reacting to the latest development, Kwaku Kwarteng said: “If you lie about your economy and you get the support that you do not deserve, in the end, the problems will still be there and it will only lead to more problems.”
He alleged that government intentionally pegged the debt to GDP ratio at 55% in order to reduce the harsh conditions attached to the bailout from the IMF.
The 71% means the nation’s debt level is way above the international benchmark for sustainable debt level.
Kwarteng remarked that the consequences for such an act is dire because “if you lie about your economy and you get the support that you do not deserve, in the end, the problems will still be there and it will only lead to more problems.”
According to him, there is a seeming “systematic attempt” by the Mahama administration to “misreport, to give a false impression of the economy in order that the political consequences for them will be lessened.”
He cautioned government that the path it is threading on “will not get this administration anywhere…It doesn’t matter what figures you put out, people will know that things are really deteriorating.”
Mr. Kwarteng however counseled the government to admit to Ghanaians that “things have really gotten bad.”
Ghana is currently in the final stages of talks with the IMF for a bailout programme to bring the country’s economy back on track.
However, prior to the commencement of the bailout talks, a former Deputy Governor of the BoG, Dr. Mahamudu Bawumia accused the Central Bank and the Ghana Statistical Service (GSS) of releasing inaccurate figures on the recent data on inflation and exchange rate.
He said he was convinced that the government was seeking to create a false impression that the exchange rate data has remained fixed over the last three months.
Both the GSS and the BOG vehemently denied the allegations and questioned the analysis made by the former Deputy Governor.
Some industry players subsequently cautioned government to refrain from presenting inaccurate figures to the IMF for a bailout.
Citi News’ attempts to reach government for a response however proved futile.
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