Ghana: Investors repose confidence in economy; IMF remains trusted advisor to government – Adu-Boahen

Ghana’s Eurobonds spreads have started to tighten across the yield curve, as investors have reposed confidence in the Ghanaian economy, Charles Adu-Boahen, Minister of State at the Finance Ministry, has stated.

From Thursday 20th January 2021 to Monday 24th January 2021, senior officials from the Ministry of Finance and the Bank of Ghana embarked on a Non-Deal Investor Roadshow.

The roadshow enabled government to engage with both offshore investors (banks and fund Managers) and onshore investors who together have assets under management in excess of $4 trillion to update them on Ghana’s recent economic performance and outlook. The engagements also provided the opportunity for government to respond to questions or concerns.

Mr. Adu-Boahen said “all in all, I must say that the engagements have been largely successful and the feedback received so far from the market has been encouraging. We have observed that Ghana’s Eurobonds spreads have started to tightened across the curve, meaning that the engagement was successful and had an impact”.

“It is important, I reiterate that these engagement over the past 3-days have impacted the market positively and concerns of investors over the economy in particular, on the 2022 budget have been addressed”, he added.

The Minister of State at the Finance Ministry also revealed that the team also met the domestic investor community on Monday 24th January 2022, which also was the first engagement for the year.

According to him, some pressing investor concerns raised and addressed included clarity on the policy to cut 2022 expenditure by 20% across board; the 2021 economic performance and outlook and Ghana’s relationship with the International Monetary Fund and whether government intends to undertake any programme with the Fund.

Ghana’s relationship with IMF strong

The Minister of State at the Finance Ministry alluded that Ghana’s relationship with the International Monetary Fund is strong.

“Our relationship with the IMF continues to be strong: The IMF remains a trusted advisor to government and continues to engage government through multilateral surveillance, technical assistance provision and capacity building. In July 2021, the IMF successfully conducted an Article IV Consultation with the government and engaged authorities during staff visits”.

Mr. Adu-Boahen noted that the government will continue to share regular updates on the economy with the IMF and remain optimistic for an Article IV Consultation in the first half of 2022.

E-Levy is a necessary policy

Mr. Adu Boahen said the E- Levy is a necessary policy aimed at increasing the nation’s Tax to GDP from 13% to 16% and above.

“The E-Levy would not only ensure that we move towards a more sustainable debt level but would also ensure that we have the revenues to sustainably invest in entrepreneurship, youth employment, cyber security, digital and road infrastructure.”

source: myjoyonline.com