MP suggests talks on debt restructuring premature

Kweku Ricketts-Hagan, the Member of Parliament (MP) for Cape Coast South Constituency in the Central Region, has suggested that the government’s talk of haircuts on investments as part of debt restructuring is premature.

“You have not started the negotiations, then you pre-empt yourself in the negotiations by making a statement that there is not going to be a haircut, you have shot yourself in the foot,” he said.

Mr Rickets-Hagan noted that the president’s address was further evidence that the government did not understand the system it was running and felt there was no need for the government to be paying attention to speculation at a certain point.

After President Nana Addo Dankwa Akufo-Addo with respect to money invested in bonds during a speech recently, the government clarified the restructuring was yet to be finalised in response to rumours and speculations.

The restructuring talks are ongoing as part of Ghana’s efforts to secure an International Monetary Fund (IMF) deal for $3 billion and the President has assured the government did not intend to slash the returns made on investments as speculated following economic challenges currently confronting the country.

He indicated that no individual or institutional investor, including pension funds, in government treasury bills or instruments will lose their money, as a result of ongoing IMF negotiations and stressed there will be no “haircuts” and urged persons making such claims to desist from such actions.

President Akufo-Addo admonished Ghanaians to ignore the false rumours and speculation just as, in the banking sector clean-up, the government ensured the 4.6 million depositors affected by the exercise did not lose their deposits but is currently seeking a $3 billion economic recovery support and assistance from the IMF.

Government as part of processes for securing IMF support and assistance is currently conducting debt sustainability analysis and there are fears investments in government securities may be affected and reports suggested GH¢3.7 billion of the GH¢3.9 billion Tier 2 pension contributions placed in government securities may be affected by the Debt Restructuring Programme.

Refuting such claims by the president, Mr Rickets-Hagan pointed out that the speculation and rumours were only consequence of the poor management of the economy since his government were behind the economy and running it and they should not be worried too much at that stage about speculation and rumours.

“Speculation is going to happen when there is uncertainty and speculation happens when people do not have trust and confidence in your economy and when your policies are no longer credible,” the MP cautioned.

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