IMANI Africa says it suspects the governing New Patriotic Party (NPP) wants to create fiscal rooms in order to “waste money during an election that is coming in 2024.”

This comes on the heels of the Central Bank, facing serious insolvency. Ghana’s government has written off half of the 77.6 billion cedis, which is equivalent to $7 billion, it owed to the Central Bank and replaced the remainder with a lower-yielding 15-year bond, three sources with direct knowledge of the transaction told Reuters.

The latest move is part of the West African nation’s push to restructure its domestic debt, a requirement to qualify for the next tranche of a $3 billion International Monetary Fund (IMF) rescue loan.

Ghana now wants to focus on negotiations with external creditors.

Speaking on the Morning Starr with Francis Abban on Tuesday, August 1, 2023, the Founder of IMANI Africa, Franklin Cudjoe, stated that for the Central Bank to allow those huge amounts to be written off “is very irresponsible.”

“There is no longer an opportunity to run to the banks and borrow as if there is no tomorrow. Essentially, the government has even managed through this DDEP and saved close to 34 billion Ghana cedis. Which means that they can say that they are not going to introduce any more taxes."

“Even then, they still want to increase that savings by asking pensioners to also get involved in the debt exchange programme. I don’t think it’s fair. What I suspect the government wants to do is to create a lot more fiscal room so that they can waste money during an election that is coming in 2024. That is what it is. Let’s not dance around the issue,” Mr. Cudjoe stated.

He continued, “I don’t think it is fair to do that to pensioners. The whole aim is to spend in an election year. Why am I saying that the government has not attempted to reduce those lofty amounts that have been set aside for capital investment, which we can do without? I mean, you can do with 10 to 12 billion of those capital investments. If you are in a hole, you don’t dig further.”