Professor Peter Quartey, the Director of the Institute of Statistical, Social and Financial Analysis (ISSER) on the College of Ghana, has cautioned the federal government in opposition to an instantaneous return to the capital marketplace for loans.
He urged the federal government to deal with multilateral financing and to be extra aggressive in rising home income mobilisation to help the nation’s improvement targets.
Prof Quartey, a Improvement Economist, gave the warning throughout his inaugural lecture as a Fellow of the Ghana Academy of Arts and Sciences in Accra on Thursday.
The lecture was on the subject: “Debt, funding, and development in Ghana: Did we borrow to eat?” It addressed key points round Ghana’s debt and improvement financing.
It was attended by financial and monetary professionals, business gamers, policymakers, and college students from a number of Senior Excessive Faculties.
Dr. Cassiel Ato Baah Forson, the Finance Minister, introduced final Tuesday, in the course of the 2025 price range presentation, that the federal government would cautiously reopen the home bond market.
Nevertheless, Prof. Quartey warned that loans from the capital market had confirmed to be costly and unsustainable for Ghana’s improvement financing.
He urged the federal government to restrict its reliance on such loans.
Ghana’s debt stood at 42.9 per cent in 2013, under the Worldwide Financial Fund’s (IMF) debt sustainability threshold of fifty per cent debt to Gross Home Product (GDP).
Since then, the debt has been rising, reaching a document excessive of 82.9 % in 2023, earlier than lowering to about 76 % in 2024.
“Why the frenzy to go to the capital market?” Prof Quartey questioned, noting that borrowing from the capital market with out investing these funds in productive ventures had led to unsustainable debt.
“[The capital market] is the place we went to, and we’re having these issues. And you continue to wish to rapidly end giving folks a haircut and go to the capital market… I wish to sound this warning! Borrow much less from the capital market and at cheap rates of interest,” he emphasised.
Prof. Quartey urged warning when borrowing, notably from Eurobonds and different capital market funds, which he described as too costly and unsustainable.
“We must shrink back from them. Allow us to get extra multilateral and home sources of funding. They’re cheaper,” he stated.
He lamented the behavior of successive governments borrowing at excessive charges from the capital market and utilizing a good portion of these funds for public sector salaries and curiosity funds, notably since 2015.
Emerita Prof Takyiwaa Manuh, Vice President of the Arts Part of the Ghana Academy of Arts and Sciences, additionally expressed concern concerning the nation’s debt scenario.
She stated, “The debtor should eat, however the debtor have to be cautious of what they eat.”
Prof. Manuh expressed confidence that Prof Quartey’s lecture would spark additional discussions to assist enhance the nation’s funds.
She referred to as on policymakers to think about and implement coverage proposals from academia to enhance the dwelling circumstances of the folks.
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