The Governor of Ghana’s central bank, the Bank of Ghana (BoG), Dr Ernest Addiosn has appealed to Ghanaians and all stakeholders to keep faith with the current managers of the economy.
According to Dr. Addison, authorities are working hard to get the Domestic Debt Exchange programme completed as part of efforts to move the ongoing discussion with the International Monetary Fund (IMF) from the staff level to the Board for approval.
Once that is done, he said, Ghanaians can expect an IMF deal by end of the first quarter of this year.
Answering questions during the 110th Monetary Policy Committee Press conference in Accra on Monday, January 30, he said “we should have faith, we are trying very hard to get this debt exchange completed, trying very hard to get the external restructuring through, all of that to help us move the discussion from the staff level to the board.
“Hopefully, once that is successful we should get the disbursements by end of the first quarter.”
The Ministry of Finance is currently engaging stakeholders especially individual bondholders on the domestic debt exchange programme.
Already, the Government of Ghana and the Ghana Insurers Association reached an agreement on the participation of insurance companies in the programme.
Under the agreement, insurance companies will participate in the exchange on similar terms as the banks, a joint statement issued by the Ministry of Finance and the Insurers Association said on Thursday, January 26.
“The government through the solvency window of the Ghana Financial Stability Fund (GFSF) will provide support for the insurance companies that are seriously affected by the DDEP.’
“The objective is to protect jobs and the stability of the Industry,” the statement said.
Last week, the Government and the Ghana Association of Bankers (GAB) also reached an agreement on the new terms for the Domestic Debt Exchange programme.
Earlier, the banks rejected the programme as announced by the government.
The GAB directed commercial banks not to sign onto the amended debt exchange offer over uncertainty surrounding the impact of the debt restructuring on the banking industry.
The association wants its concerns addressed before accepting the debt exchange offer, according to a letter sent to managing directors of banks and seen by 3Business. GAB told member banks that may want to consider the debt exchange in its current form to formally inform the association first before doing so.
“…From the uncertainty surrounding the programme, GAB recommends that all banks must stay any further movement on the exchange until our demands have been met. However, in the event that a bank may have to move forward to exchange, the MD/CEO must inform the CEO of GAB directly of the decision,” according to the letter sent to the banks.”
However, after an engagement with the Ministry of Finance, the Association of Banks that per the new terms, the participation of member banks is subjected to individual bank’s internal governance and approval processes.
“This is a significant milestone towards addressing our economic challenges, and will thus help to restore macro-economic stability and accelerate Ghana’s economic growth.
“With this achievement, the Government of Ghana reiterates its commitment to concluding the DDEP in time with all other stakeholders,” a joint statement from the Finance Ministry and GAB noted.
