Former Finance Minister, Yaw Osafo Maafo has contested claims that Ghana could be declared a Highly Indebted Poor Country (HIPC) due to the way the economy is being managed by the current administration.
He argued that Ghana as a middle income country would not meet HIPC's threshold requirements of the International Monetary Fund and the World Bank.
Osafo Maafo added that the HIPC initiative is to provide debt relief and low-interest loans to very poor countries in the world and Ghana is not inclusive.
Ghana under the erstwhile Kufuor administration in 2001 joined HIPC and received various funds under the arrangement for poverty alleviation and infrastructural development.National Democratic Congress (NDC) then in opposition condemned the Kufuor government for going HIPC.
But years down the line, concerns have been raised about Ghana’s current debt stock which according to some economic experts could slip the country back into HIPC.
The opposition New Patriotic Party (NPP) which agrees with the position attributed the economic crisis to government’s overspending in the last four years which it claims has increased the country’s total debt to GH GHC35 billion.
However, speaking in an exclusive interview on Asempa FM’s Ekosii Sen programme Tuesday, Yaw Osafo Maafo blamed the economic crisis on what he called fiscal indiscipline on the part of government.
He indicated that government overspent its stipulated budget which he said accounted for the fiscal deficit. The former Finance Minister under whose tenure Ghana went HIPC said the only way the Mahama-led administration can recover is to increase taxes. Yaw Osafo Maafo also proposed that the Finance Ministry put a seal on government spending.
He intimated that Ghana, just like Spain, needs to sacrifice a lot to exonerate itself from becoming a Heavily Indebted Poor Country. Osafo Maafo also called on the Finance Minister, Seth Terkper to consult him or other experienced economists to salvage the country’s economy.