An economist at the University of Ghana, Godfred Bokpin, has expressed concern about Ghana’s financial crisis, noting that the country’s fiscal issues were evident as early as 2021.

Speaking on Morning Starr with Naa Dedei Tettey, he remarked, “The data was quite clear that Ghana was heading dangerously,” and criticized the government for not addressing the situation sooner. He emphasized that the delay in seeking assistance from the IMF only worsened the crisis: “Government delay in reaching out to the IMF actually compounded the situation.”

According to him, if the government had acted proactively in late 2021, “the debt exchange or the debt restructuring would have been avoided.” In comparison, “Kenya proactively reached out and escaped the haircut.”

He explained that the situation escalated by December 2022 when Ghana’s domestic debt exchange was completed, yielding fiscal savings of approximately 61 billion cedis. However, the analyst highlighted the heavy toll on those who lent money to the government, stating, “while it represents fiscal savings to the government, that is a cost to bondholders.” He pointed out that many affected individuals had “worked so hard over the years,” and their investments in government bonds led to significant financial strain, especially for “pensioners, individual bondholders, and body corporates.”

Reflecting on the impact, he lamented, “That was pain, that was distress,” contrasting the government’s relief with the hardships faced by ordinary citizens. Some had “taken their pensions, the lump sum, and invested it in there,” only to have their investments tied to long-term bonds.