…Akufo-Addo Pins Hope On $20billion Chinese Loan
The government of the Republic of Ghana has run out of money desperately needed to keep the wheels of statecraft moving.
Clear signs of the dire straits include delayed payment of salaries of public sector workers by the New Patriotic Party (NPP) administration.
According to the Member of Parliament for Bolga Central, Hon. Isaac Adongo, the situation is so bad that government is now constrained to borrow for the recurrent expenditure of salary payments.
“Government is essentially broke and is gasping for liquidity breath. After releasing a paltry GHC200million for Free SHS which essentially went in to settle 2 terms of arrears of SHS’s being some unpaid bills, Government had to now engage in aggressive borrowing last week in order to pay September salaries.
“The Minister of Finance desperately stopped the Controller and Accountant General from processing September salaries for workers in the Public Sector under the guise of “additional validation measures and inputs for financial clearance” long after the closure of IPPD for September salaries,” a release by the Office of Hon. Adongo revealed.
As a result of the massive borrowing by the NPP government, the vociferous NDC MP revealed that the public debt, which is already some 68% of GDP, keeps on ballooning.
Most public sector workers have not received their salaries for September. Those who have received their salaries happen to be in luck, simply because they bank with state-owned banks, like the GCB, ADB and the NIB, which were willing to advance interest free payments by crediting the accounts of their clients on behalf of government.
However, as Hon. Adongo points out, workers with privately- owned banks have not received their salaries on time because the government does not have money to credit to their accounts.
In a bid to tackle the issue, Hon. Adongo reveals, the government has taken to massive borrowing to pay salaries.
“It is rather both very shameful, depressing and heavily embarrassing for a government to borrow not for infrastructural development but to pay salaries. Borrowing for recurrent expenditure is the most unacceptable thing that we should allow a government to do. Ghana is retrogressing with speed.”
Hon. Adongo, who questioned the claims by Vice President Dr. Mahamudu Bawumia, in the buildup of the 2016 elections, that there is a lot of money in Ghana and that government does not need to borrow, added for good measure that the mess on the hand of the government is a tip of the iceberg.
“Economic Management is not “mouth mouth.” The reality is even yet to come. What we are seeing is just the tip of the iceberg.”
The knell by Hon. Adongo is sounding at a time that the Presidency has asked Assemblies in the Northern Region to cough up money to sponsor the President’s three-day tour of the region.
Hon. Adongo also points out that only 20% of a budgeted amount for the government’s flagship Free SHS program has been paid, with no one knowing when the remaining 80% will be paid.
Amidst the mess, fuel prices have shot through the roof, while inflation has risen sharply from 12.3% in July, to 13.1%. Also, total public debt has risen from Ghc122 billion to Ghc139billion in just nine months of the NPP administration.
Interestingly, the statistics keep worsening in spite of the fact that the economy is managed by US Consultancy firm, McKinsey and Co, which the NPP government, known to boast that it has the men, hired to provide backroom services.
Meanwhile, the dire straits that the government finds itself in have made President Akufo-Addo very desperate to have the Government of China honor its promise to invest some $20billion into the economy.
Finance Minister, Ken Ofori-Atta, last week, revealed that President Akufo-Addo will follow up the $20billion, which the Chinese are said to have promised Ghana upon the visitation of Vice President Bawumia to that country in June, this year.
Even though Ghanaians have been told that in exchange for the $20billion, China will be given access to $460billion worth of Ghana’s bauxite resource, it appears the Chinese are doubtful, hence necessitating President Akufo-Addo’s follow-up next year.
Telltales are that the NPP government, which when in opposition had promised never to borrow, is banking its hopes on the $20billion Chinese loan, without which a lot of things that the President has promised to do cannot be done.
But, the opportunity cost to Ghanaians in the matter of this $20billion Chinese loan is the $460billion worth of bauxite, mining of which will lead to the destruction of, among others, the Atiwa ecologically reserved forest.
Hon. Adongo has said, the constraints of the NPP government are due to incompetence.
“The incompetence in the fiscal management of the Akufo Addo/Bawumia-led Government keeps showing up on a daily basis.
“The poor revenue performance reflects the lack of innovation in raising revenues. We still recall like yesterday, Dr Bawumia saying “the money is here. We know how to find it.” Where is that magic wand, Dr. Bawumia?” Hon. Adongo sneered in the write-up.
Source: therepublicnewsonline.com/ Fiifi Samuels