The Minister of Finance, Mr Seth Terkper, has assured Ghanaians that the US$1 billion Eurobond is not missing and has not vanished into thin air.
“I want to assure the good people of Ghana that the money is neither missing nor has it vanished into thin air. The money is there,” Mr Terkper said.
He explained that part of the amount had been disbursed, but the substantial portion was lodged in the Bank of Ghana’s (BoG) New York account.
DR Mahamudu Bawumia, the 2016 Vice Presidential Candidate of the New Patriotic Party (NPP) had charged the government to list projects that the $1 billion Eurobond raised in the money market had been used for, as it was not mentioned in the 2015 budget.
Speaking at a breakfast meeting with UK-based Ghanaian professionals in London last week, Dr Bawumia said he believed that the $1 billion Eurobond had been used to do nothing more than artificially shore up the cedi from depreciating against the major currencies.
In the 2015 budget statement presented to Parliament by Mr Terkper recently, he was silent on the money and how it had been disbursed by the government.
But in an interview with the Daily Graphic, Mr Terkper explained that the reason was that negotiations for the money were done in mid-September and that “at the time the processes were concluded, we were into the last quarter”.
Out of the amount, he said, US$250 million had been set aside for the Ghana Infrastructure Fund, adding that the effective date for its implementation was next year but preparatory activities were currently underway.
The money, he said, would be used for commercial projects earmarked under the fund.
Part of that money, he said, would be used to defray government guaranteed loans for the gas processing project, the Bui Dam, thermal plants and grid lines.
For refinancing, he said US$200 million had been set aside, out of which US$70 million had been used to refinance domestic debts that became due at very short notice and high interest rates.
He said concerning the amount for capital expenditure and counterpart funding, which were US$250 million and US280 million, respectively, “we have started disbursing the counterpart funding to finance the remainder of government expenditure on the gas plant and the Kumasi Market project”.
Provision, he said, had been made for the gang of six projects which started without funding, which included the Nsawam-Suhum-Apedwa road.
He said the money would be used to reshape bad portions of the Nsawam-Suhum Apedwa road to make it more motorable.
Mr Terkper said the planned utilisation of the Eurobond was consistent with how the last sovereign bond was applied.
Out of the amount, he said, the government was also planning to reimburse certain banks, both domestic and international, and also use part for overdraft payments provided by the BoG.
He also assured Ghanaians that as the government did in 2013, the full list of projects and how money would be spent on them would be provided.
Already, he said, further disbursement of the government of Ghana counterpart funding to the China Development Bank (CDB) loan included the gas plant, Accra roads project, coastal fishing harbour projects.
The CDB loan is 85 per cent of the total cost of projects envisaged under the loan. Other counterpart payments that would be made by the government, he said, related to the Kwame Nkrumah Interchange project.
He gave an assurance that the government would return to Parliament as required by law and give full details of the Eurobond “as we did previously when Ghana contracted the Eurobond and as we have done to oil revenues”.
Source: Graphic Online
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