A Member of the Finance Committee of Parliament, Kwaku Kwarteng is predicting Ghana’s financial challenges will worsen.
He was responding to the Deputy Minister of Finance and Economic Planning, Mornah Quartey’s assertions that the recent downgrade of Ghana’s credit rating by Standard and Poor’s (S&P) is purely “speculative.”
Ghana’s credit rating was downgraded further into “junk” territory by S&P on concerns that access to financing will continue to be a struggle even if the Ghana enters adopts an International Monetary Fund programme.
S &P highlighted that despite a successful international bond issue earlier, the country has gross external financing needs of 137 per cent of current account receipts and reserves next year, and therefore relegated Ghana one notch to B-, six levels below investment grade today.
But Mornah Quartey downplayed S&P’s report, saying “The short term outlook was stable and they didn’t downgrade us on that. We kept our rating and that was fine and that is why we have our challenges so I’m glad that, that did not change.”
Speaking on Eyewitness News however , Mr. Kwarteng said S&P’s rating was a true reflection of the situation on the ground.
Mr. Kwarteng who is also the Member of Parliament for the Obuasi West Constituency said, “there is every indication that our fiscals will not be as we are pretending it will be. I think that it will be worse than that.
The international observers are beginning to say that we don’t trust this administration to do the right things in order to check the fiscals.”
He also chided government for its decision to constantly seek support from international donors, saying, “We have been borrowing from the international capital markets, we’ve borrowed domestically, we just took 45 million euros for maintenance of roads…”
On the IMF programme, Mr. Kwarteng said government has failed to prepare Ghanaians to “face some of the territories they will need to implement to make the programme a successful one.”
“I think we should take the concerns that have been expressed by the agencies on board. We really have not demonstrated that we are in a position to implement some of the commitment we have made to the IMF right now,” Kwaku Kwarteng added.
Officials from the IMF are expected back in Ghana in November to begin the third round of talks for a bailout programme.
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