Deputy Minister of Finance, John Kumah, has admitted that the Nana Addo Dankwa Akufo-Addo government is prone to mistakes and that some of its actions may have led to the current distressed state of the economy.

To that extent, he stated in an interview on Joy FM (December 6, 2022) that the government was not a perfect institution and was open to criticism by sections of the public.

“We are not a perfect institution. We can make mistakes, and our decisions are allowed to be criticised,” he is quoted to have said on the Joy FM Super Morning Show.

Kumah, who is also Member of Parliament for Ejisu, added that the current state of the economy was also due to after effects of the COVID-19 pandemic, even though there has been some improvements since then.

The government has come in for backlash after it announced a domestic debt exchange for institutional bondholders as part of measures to secure an International Monetary Fund, IMF, programme before the end of the year.

The debt exchange has received stiff fightback especially from a number of institutions including the Trades Union Congress (TUC) and the Ghana Medical Association (GMA) who are insisting that the debt exchange should not affect pensions.

The deputy minister in the same interview also spoke about how excessive borrowing could have triggered the current economic crisis.

According to him, the government could have considered other alternatives to financing its projects and programmes aside from borrowing.

“Maybe the levels of borrowing have been too much and that could be one of the areas. Maybe we should have looked at more alternatives for financing our various programmes but of course, every nation is built on debt, it is what you do with it and what happens [that matters].

“I know we are where we are because, if you borrowed in 2017, 2018 and 2019, US$3 billion of investment each year and you were expecting the returns after 2020 and Covid-19 struck, and brought your economy to almost zero, it means that you are already in a very difficult situation.

“So, this is the reality of what happened, it’s not like we borrowed and did things that didn’t benefit the country,” he added.

Minister of Finance, Ken Ofori-Atta, on December announced a number of measures under the government's Domestic Debt Exchange (DDE) programme.

He said the announcement was in line with the government's Debt Sustainability Analysis as contained in the 2023 budget he presented to Parliament on November 24.

The minister laid out, among other things, the exchange of existing domestic bonds with four new ones, as well as their maturity dates and terms of coupon payments.

He also addressed the overarching goal of the government relative to its engagements with the International Monetary Fund as well as measures to minimize the impact of domestic bond exchange on different stakeholders.

"The Government of Ghana has been working hard to minimize the impact of the domestic debt exchange on investors holding government bonds, particularly small investors, individuals, and other vulnerable groups," he said, before outlining three main measures:

• Treasury Bills are completely exempted and all holders will be paid the full value of their investments on maturity.

• There will be NO haircut on the principal of bonds.

• Individual holders of bonds will not be affected.

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