Prof. Lord Mensah expresses worry for economy post debt exchange programme
Finance Lecturer at the University of Ghana Business School (UGBS), Professor Lord Mensah, has expressed concern for the Ghanaian economy post the domestic debt exchange programme (DDEP).
According to Prof. Lord Mensah, dampened investor confidence resulting from the implementation of the debt exchange programme by government, is likely to impact economic growth post the debt programme.
Speaking on the PM Express Business Edition on Thursday and monitored by norvanreports, Prof. Mensah averred government is going to have a tough time trying to revive investor confidence in the economy.
“I am deeply worried about the economy post the DDEP, because the investor confidence that is being dampened today through the debt exchange programme, will be the same one needed to grow the economy post the DDEP.
“Government after the DDEP needs a safe fiscal space to build the economy and if investor confidence is severely dampened and there are alternatives to investing in government securities, they will go for the alternatives (sic),” he remarked.
“And another thing I am worried about is that, if government continues to spend recklessly and inefficiently as it is doing now post the DDEP, we are very likely ro return back to our present economic difficulties (sic),” he added.
Speaking further on the programme, Prof Lord Mensah quipped government seems to be rushing with its domestic debt exchange programme.
This, he believes, is due to the novelty of the debt programme.
According to him, it would have only been prudent for government to have used ample time to engage the investor community on the exercise, while affording them enough time to think through their decisions.
“We seem to be rushing because if you look at the numbers that were churned out, and the time that we’re using to negotiate, we did not give the investor community [enough time] to absorb the kind of information that is before them for them to think through as to whether they can adapt or adjust to a level where they can come to a compromise.
“We just seem to be pushing things down the throat of the investor community,” he said.
Government has for the fifth time, extended the deadline for the Domestic Debt Exchange Programme (DDEP) to February 7, 2023.
The Finance Ministry in a press release on Tuesday, January 31 averred that a new settlement date of Tuesday, February 14, 2023, will be confirmed via the new Exchange Memorandum.
The original deadline for the Programme expired at 4 pm, January 31.
