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Business News of Thursday, 23 July 2020


Govt borrowing unnecessarily to fund election 2020 - Seth Terkper alleges

Former Finance Minister, Seth Terkper Former Finance Minister, Seth Terkper

Former Finance Minister, Seth Terkper has alleged that the government's continuous borrowing from international firms is to fund the upcoming December polls.

According to him, despite the government's efforts to fight against the global pandemic – coronavirus- they need to focus on cutting down their expenditure. This, he says, when done will help the country's coronavirus-stricken economy to recover.

Speaking on measures that the government needs to put in place to revive the "dying" economy, Mr Terkper told GhanaWeb's Ernestina Serwaa Asante, that, "Every country is cutting and reprioritizing expenditure. Because it's an election year, they continue borrowing".

He, therefore, requested that the Finance Minister, in his presentation of the mid-year budget in Parliament today needs to explain to Ghanaians why the Government of Ghana's (GoG) figures does not tally with that of the International Monetary Fund (IMF). He insisted that “the GoG must reconcile the country’s fiscal data with that of the IMF. This comes after the continuous exclusion of exceptional expenses and arrears by the GoG in its fiscal reporting”.

Mr Terkper furthered that government needs to separate the COVID-19 borrowing from that of the 2020 budget borrowing.

"Government should separate the borrowing that they are making for COVID which is about 10 billion which I argue that if we add the IMF money, the World Bank, African Development money and our own stabilization money it will be enough to cover that. They should separate that from the gap because there are two gaps. The gap created by COVID and before COVID there was a gap in December when they did Article 4, at the same time they were sending the budget to Parliament for approval and that gap had been repeated in the COVID report".

The Finance Minister's Mid-Year budget presentation in Parliament, which is expected to take place this morning is in accordance with Section 28 of the Public Financial Management Act, 2016 (Act 921).

The budget reading is to give an overview of the macroeconomic development of government over the past 6 months and that for the rest of the year.