The Finance Minister, Ken Ofori Atta has disclosed that the government will inject 1.5 billion dollars, into the National Stability Fund to help offset the losses incurred during the Domestic Debt Exchange Programme (DDEP).
The banking sector is predicted to lose about ¢41.3 billion to the DDEP, between 2023 and 2028 which has resulted in many banks struggling to stay afloat.
The debt restructuring exercise became crucial to help bring the country’s debts to sustainable levels.
The program also became key to Ghana gaining access to a US$ 3 billion credit facility, from the International Monetary Fund. (IMF)
In a press an IMF engagement, Ghana’s Finance Minister Ken Ofori Atta indicated that ” with regards to the banks, yes, we went through the DDEP program, and we have all seen the effect on the banking sector and therefore the structure of the Ghana Financial Stability Fund which we intend to fund with $1.5 billion”.
Mr. Ofori Atta added that “$250 million will come from The World Bank and the government will contribute $500 million as we still speak to our development partners for them to participate in the exercise. As you know it was really crucial to be able to reduce the level of interest that we are paying to support our debt”.
“The World Bank should hopefully, in the third quarter, be able to bring that initial support going forward, as you know we are running a budget deficit. We are also agreeing for zero financing for that so to continue to support the programs that we have is where the $600 million will be deployed” he added.
He also indicated that “going forward, the issue of efficiency of government and efficiency of services to the people are going to be key, and therefore finding ways of ensuring that we are efficient in our deployment what we have will be very crucial”.