BusinessNewsTOP STORY

Investors may die of shock over Ofori-Atta’s debt exchange programme

Local investors with bonds will have to bear the brunt of the government’s domestic debt exchange programme and  may die of shock from the amount of cuts on their investments.

This is according to an economist, Menson Torkunoo who says existing domestic bonds as of 1st December 2022 will be exchanged for a set of four new bonds maturing in 2027, 2029, 2032, 2037.

His comment comes after Government’s debt restructuring policy was announced on Monday by Finance Minister Ken Ofori-Atta.

The debt exchange programme is likely to have adverse effects on bonds, with talks of 30% haircuts causing fear and panic within the local investor community.

But Torkunoo who was speaking on Starr FM’s midday news pointed out that the Akufo-Addo government has lied to Ghanaians on the purpose of some policies such as the E.S.L.A and Daakye bonds.

“We don’t have an honest government. This is very sad. I tell you honestly people are going to die as a result of this announcement. I am telling you the facts. Because this is the same way this same government spent about 25 billion Ghana cedis to wipe away or to rationalize between seven to nine billion they have alleged to have caused by banks,” he stated.

Mr. Tukornu underscored the situation where the nation’s economy is heading to ground zero has never happened in the history of the country.

Meanwhile the Minority Spokesperson on Finance, Dr Cassiel Ato Forson has painted a gloomy picture for the country’s finances, saying the economic mess under Finance Minister Ken Ofori-Atta and President Akufo-Addo will take at least a decade before it will be stabilised.

Dr Ato Forson is a former Deputy Finance Minister

Speaking on Dwaboase on TV XYZ, the former Deputy Finance Minister worryingly observed that the IMF intervention the government is banking its hopes on cannot save investors’ funds as far as the debt restructuring goes on.

He also said there will be job losses in the banking sector soon because of the government’s failure to service its debt owed the local banks.

said the wanton borrowing by the government from local banks and failure to service the debts could collapse some banks in the country.

Dr. Ato Forson who was speaking to Kwame Minkah on Dwaboase on TV XYZ indicated that since the banks are the holders of these bond whose funds the government have borrowed and cannot pay could cause job losses in the financial sector.

He strongly believes the debt restructuring policy will adversely affect not only banks but their customers as well as haircuts keep soaring.

“I want us to understand that the bank’s work is to convince people to save or invest with them, then they use these monies to buy bonds and it is the interest generated from these bonds that the banks use to pay their staff as well as pay interests to their clients so if the government fails to pay the banks, operations of these institutions will suffer and can lead to their collapse,” he said.

“I know that 50% of their revenues come from government bonds and other banks whose receivables used to run the bank come from government bonds,” he stated.

The MP for Ejumako Enyan Essiam, therefore, argued that the policy is going to reduce the strength of the bamks and even lead to the laying off of bank staff.

“If the banks struggle and can’t pay their staff, there’ll be layoffs,” he said in Akan.



Back to top button
Translate »