Financial analysts are warning government to be extremely cautious in its quest to immediately go back to the capital market following the approval of the country’s deal with the International Monetary Fund (IMF).
The warning comes after fresh hints by President Akufo-Addo that government has plans to borrow again from the market soon to fund infrastructural projects despite the Finance Minister’s assurances that government is no rush to do so.
Director of Business Strategy at Dalex Finance, Joe Jackson says the contradictions among government officials on the timelines on Ghana’s return to the capital market raises serious questions.
Speaking to Citi Business News, Joe Jackson urged to government to exercise fiscal prudence.
“We haven’t finished negotiating the deal with the current creditors. We have a commitment as to the way forward, but the deal has not been finalized yet. Until we are done with our debts that we have defaulted, we cannot be thinking about going back to the market soon.”
“The President’s definition of soon is different from my understanding of soon. There are mixed feelings from the Finance Ministry and the President. We have to fix the economy before we go back to that market”, he said.
President Akufo-Addo at the Qatar-Africa Economic Forum in Doha disclosed that Ghana is well positioned to return to the international market to get funds to continue with ongoing projects.
This comes barely a week after Finance Minister, Ken Ofori-Atta emphasized the country’s commitment to fiscal responsibility, stating that Ghana will not hastily seek to return to the international capital market for borrowing.
He stressed the significance of curtailing and effectively managing expenditures to achieve long-term financial goals.
The finance minister emphasized that Ghana will not rush back to the international capital market, as the government aims to rely on improved revenue streams and expenditure management to meet its financial requirements.
“There is no rush in going back to the international capital market. Our expectation is that, by managing our expenditure and increasing our revenue, we will have the resources to address our needs. Working towards the capital market is important because we want to get our ratings up and make the country more attractive for investors, especially FDIs. So, no one is rushing to the capital market at this juncture”, Ken Ofori-Atta stressed.
