Debt exchange: Ghana’s economy is sitting on time bomb waiting to explode – Pianim

Ghana’s economy is in bankruptcy, a renowned economist, Mr Kwame Pianim, has said.

In his view, the economy is sitting on time bomb waiting to explode.

Mr Pianim said this is due to policy measures including the domestic debt exchange programme introduced by the Finance Minister Ken Ofori-Atta.

The Government announced that under the programme which has met strong resistance from most Ghanaians including members of the Individual Bondholders Forum (IBF), individual bondholders were to submit to a “voluntary” arrangement to exchange their domestic bonds for new benchmark bonds.

Mr Pianim who is also a founding father of the governing New Patriotic Party (NPP) told TV3’s Paa Kwasi Asare in an interview on Wednesday January 11 that “For this government to allow Ken Ofori-Atta to sit in front of Ghanaians to make this proposal…

“If Ken was genuine, when the Attorney General came with his legal opinion, which in the commonwealth has the force of a high court order, he would have taken this document and gone to the International Monetary Fund (IMF). If indeed, it is the that IMF that told him to do that, I think it is unlawful, it is unconstitutional.”

He added “… Ken Ofori-Atta is saying, let us do this programme but this is badly thought out, not thought through carefully. This exchange programme is like a time bomb that Ken is putting under this economy. For the next 30 to 40 years, we are going to suffer from it. It is a time bomb because he is squeezing billions of Cedis from this economy .

“Government’s instruments, T-Bills and and government bonds are risk-free, that is why insurance companies and banks are mandated not to invest in them because they are risk free

“Ken Ofori-Atta has the unenviable reputation of going down in our history as the one who made government’s bonds not risk free. He will go down as the only Minister for Finance who has led to this country into bankruptcy . That is where we are.”

Meanwhile, a group of individual bond holders is preparing to sue the Government of Ghana over their inclusion in the debt exchange programme after initially being spared.

The group has issued an invitation to all eligible bond holders to join the class-action which is expected to be filed next week.

”This decision and action are unconscionable, and the Government cannot be allowed to use its might to impoverish Ghanaians. We are by this bulletin inviting eligible bond holders who seek to protect their interest to join the class action,” the invitation read.

About 50 bond holders have signed up to be part of the lawsuit a few hours after the notice to join was shared on social media platforms, Convener of the group Kwadwo Agyapong told 3Business.

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