Former Finance Minister warns of financial collapse if Debt Exchange is not properly managed
Former Finance Minister of Ghana, Dr. Kwabena Duffour has urged the government to properly manage its debt exchange program to prevent the collapse of the financial sector.
He has warned that the government’s current approach has the potential to weaken the financial sector and cause problems for financial institutions, who may have to look elsewhere for monies to pay their clients.
Dr. Duffour has specifically highlighted his concern that the government’s decision to include insurance claims in the debt exchange program may cause difficulties for insurance companies, as the premiums they collect are now in government bonds.
He has recommended that the government engage in a roundtable discussion with private entities to come up with solutions to help structure the debt and include shareholders in the process to avoid any negative consequences.
This call for a roundtable discussion adds to the many calls by stakeholders for the government to consult with private entities in structuring the debt.
On Thursday, the Ministry of Finance set up a technical committee to further engage individual bondholders on their inclusion in the debt exchange program.
The convener for the Individual Bondholders Forum, Senyo Hosi, has stated that the committee will make recommendations upon which the exclusion of their bonds will be decided.
