Editorial: Ghana could be out of its economic doldrums soon

Prof. of African History links current economic hardship in Ghana and Africa to prolonged border closure

News that the Chinese government has given a strong indication that it is willing to help Ghana secure its balance of payment bailout is indeed reassuring, considering the economic doldrums the country finds itself in today.

The Chinese government has unequivocally indicated that it has an obligation to ensure the Ghanaian economy does not collapse.

China poses a lot of confidence in the country’s long-term economic prospects, according to the Chinese Finance Minister Mr. Liu Kun.

This follows a delegation from the Ministry of Finance, Foreign Affairs Ministry and Bank of Ghana led by Ghana’s Finance Minister Ken Ofori-Atta that visited Beijing to engage China over a US$1.7billion debt.

The bilateral talks with China on debt restructuring went well, and the country should be the better for it. According to Ken Ofori-Atta, government is making significant progress on securing a deal with the International Monetary Fund (IMF); and the bi-lateral discussions with China in this regard look promising.

Ghana will soon secure external assurances from China, the finance minister has assured, and that should send positive signals to the investor community as well bilateral partners.

Government is also making significant progress in negotiations with the Paris Club. The country’s total debt owed its external creditors is pegged at US$29.2billion and Ghana owes China about US$1.7billion.

Coupled with the above, the United States government has promised to intervene on Ghana’s behalf with the Paris Club as the country seeks debt forgiveness as part of the International Monetary Fund’s balance of payment support.

US Vice President Kamala Harris announced this at a joint Press Conference with President Akufo-Addo.

Vice President Harris said the US will help Ghana with all the support it needs to ensure that it sails through its current economic crisis.

The US has also announced that its Department of Treasury’s Office of Technical Assistance (OTA) will deploy a full-time resident advisor to assist the Ministry of Finance develop and execute medium-to-long-term reforms needed to improve debt sustainability and support a competitive, dynamic government debt market.

Since Beijing is the single largest holder of Ghanaian debt, it is impossible to restructure Ghana’s external debt stock without China at the negotiation table. Which is why confidence is growing that brighter days are in the offing.

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