A Deputy Minister of Finance, Hon. Fifi Kwetey has exposed the New Patriotic Party (NPP) Minority’s mischief in raising the spectre of the Ghana’s crippling debt status, in recent times. According to the deputy minister, the crux of the NPP and its Minority’s noises over the nation’s current debt situation is that the opposition party, in an attempt to protect its parochial interest, is scared of the massive development that the Mills government is undertaken and how this would boost the Better Ghana Agenda and serve as a panacea for NDC’s retention in power.
Hon Fifi Kwetey was reacting to a concern raised by former Deputy Minister of Finance in the Kufuor-led NPP government, Prof Gyan Baffuor, who claimed that all the excess money the country made above the original projected $70 per barrel of crude oil should have gone into stabilisation fund instead of being used for development. The former finance minister raised the concern after the Minister of Finance, Dr Kwabena Duffuor, presented the ‘2011 Mid-Year Review Of The Budget Statement And Economic Policy And Supplementary Estimates’ to Parliament on Thursday. (See pages 4& 9 for highlights).
The deputy minister, in throwing light on the statement read in Parliament by his boss, told The Catalyst in an exclusive interview that “adequate provisions have been made for both the stabilization and heritage funds.”
This, he hinted Prof. Gyan Baffuor could not be oblivious of and so found it difficult to comprehend the worry of the NPP Member of Parliament for ……. Prof. Gyan Baffuor also claimed that the economy is being so badly managed that it is on auto pilot.
But Hon Fifi Kwetey, whiles laughing the NPP MP’s claim off, told this paper that “It was the so-called auto pilot that took us out of intensive care unit into the accomplishment of what the NPP could not achieve in eight long years.” The deputy minister insisted that the principal motive of the NPP and its minority in crying wolf about Ghana’s so-called untenable debt situation is that the Akufo-Addo-led party is worried that should the Mills-led NDC government succeed in carrying its massive developmental agenda through in its first term, the 2012 elections will be much more difficult for them to fight than they originally anticipated.
Prof Gyan Baffuors’s farce has been the latest in a string of concerns raised by the NPP over Ghana’s current debt status, described by Hon Samuel Okudzeto-Ablakwa in one instance as “yet another disappointing lie.”
It would be recalled that on Monday 27th June 2011, The New Statesman newspaper, an NPP mouthpiece, published that “Ghana’s total debt has doubled in just two years under President JEA Mills. Documents made available to the New Statesman from policy think tank, Danquah Institute, indicate that Ghana’s total debt may be as high as $13.9 billion currently.”
The New Statesman and Danquah Institute claimed in that publication that “At the end of 2008, when the New Patriotic Party left office, Ghana’s domestic debt stood at GH¢4.8 billion (or $3.170bn in today’s exchange rate). At the end of 2010, under the National Democratic Congress, this had shot up to Ghc8.28bn ($5.47bn).”
But government, in a sharp rebuttal, exposed the falsity in the NPP claim. Hon. Okudzeto Ablakwa noted in an official statement that “Ghana’s total debt as of May 2011 is $13.4bn. The national debt at the end of the 2008 Financial Year was $8.1bn.”
Hon. Fifi Kwetey, who flawed Mr Gabby Asare Ochere Darko, the Executive Director of Danquah Institute and Publisher of the New Statesman in a debate preceding government’s official reaction to the falsity, pointed out that no country on earth has developed without borrowing.
The Deputy Finance Minister cited the examples of China and Brazil who have become models of development the world over, to which Gabby agreed. He argued that what is important is the prudent and efficacious use of the loans for accelerated development of the country, which will facilitate easy repayment. It would be recalled that the 2012 flagbearer of the NPP and onetime publisher of the Statesman, Nana Akufo-Addo, has announced recently that he would soon outdoor a 10-year development plan modelled on the Brazilian and Taiwanese development of aggressive industrialisation, which was described as “cut and paste development model” by Hon Okudzeto Ablakwa.
The statement noted that government has over the last two years concentrated on infrastructure expansion in the areas of health care, education, roads, and energy among others. This it says is a far cry from the recent past when expensive facilities, notably the $750million Eurobond, were not used for any major infrastructure work to bring about a significant infrastructural boost to the economy.
“For a facility that was so expensive to pay back at 8.5% per annum with a 10-year payback time, the NPP used the $750m to procure prepaid meters, locomotives when rail tracks had not been constructed, AGC shares and payment of salaries. This unfortunate misapplication of expensive debt resulted from the NPP government’s inability to ensure the readiness of critical feasibility studies for projected infrastructural projects before securing the facilities,” it pointed out.
It is also important, the statement said, that Ghanaians know that while the NPP claimed that it came to meet a national debt of 40 trillion old cedis in 2001, at the end of 2008, the country’s debt was $8.1bn (which is more than 100 trillion old cedis or GH¢10 bn). This was despite the fact that under HIPC, $4bn (or more than 40 trillion old cedis) of the country’s debt was wiped off. “It will be interesting to hear the NPP tell us what occasioned the above development and also how they expected government to finance the repayment of the difficult financing arrangements they entered into like the Eurobond”, Hon. Okudzeto Ablakwa added.
Prof Gyan Baffuor’s claim comes closely on the heels of another concern raised only days earlier by the NPP Minority led by Hon. Osei-Kyei Mensah-Bonso about the recent $3 billion Chinese Loan Agreement laid before Parliament. Also in the first quarter of the year, the NPP minority excessively criticised a $1.8 billion loan agreement with China, brought before Parliament by the government. The According to the group, the terms of the 1.8 billion dollar loan agreement for the construction of roads in the eastern corridor would tie up Ghana’s oil revenue for fifteen years.