Akufo-Addo: Govts borrow to create assets

President Akufo-Addo

President Akufo-Addo

The government will continue to borrow money to put up projects to ameliorate the plight of the citizenry.

This is because every country borrows and such borrowings are assets that transform the economy and develop infrastructure.

President Nana Akufo-Addo was addressing, an entrepreneurship forum organised by the Tony Elumelo Foundation in Nigeria and cited many developed countries borrow, including the United States.

“We will borrow money, everybody borrows money, the United States of America is one of the biggest debtors in the world, borrowing money is not necessarily a betrayal of the concept of independence, the key for us in borrowing money is we borrow money to create assets that will allow us to pay the money back, that is key, if we borrow the money and use it properly it is an asset for us in expanding our economy and infrastructure,” he pointed out.

The President was responding to a question from one of the participants who asked why he goes for loans from China despite his Ghana Beyond Aid mantra.

“Borrowing money is not aid, what President Xi Jinping offered is a $60 billion fund which African countries can access, not as aid but as loans, if you can produce a project the Chinese think is worth supporting, you can have access to that money, but you have to pay it back,” President Akufo-Addo indicated.

At the China-Africa Forum for Cooperation (FOCAC) 2018 summit in October, China announced a new $60 billion kitty for Africa’s development as part of a raft of new measures to strengthen Sino-Africa ties.

The money will be channeled to projects aligned to the Chinese government’s Belt and Road Initiative covering telecommunications, construction of roads, bridges, sea ports, energy and human capacity development which includes Kenya, Tanzania, Ethiopia, Djibouti and Egypt.

The funding is broken down into several parts with $15 billion being categorised as government grants, $15 billion as interest free loans and $ 20 billion of credit lines and $ 5 billion for financing imports from Africa.

One of the African countries which have already received a share of the $60 billion is Ghana which signed eight cooperation agreements with China during the 2018 China-Africa summit.

One of the deals includes a $2 billion infrastructure agreement for Ghana to improve its roads and develop railways in exchange for bauxite. -ghanaweb.com

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