Deputy Member of Parliament’s Finance Committee, Isaac Adongo, stated that Ghana’s loan request from China is unlikely to succeed due to China’s current economic and geopolitical stance.
In a radio interview with Citi FM last Friday, Mr. Adongo explained that China’s political and economic ideologies are incompatible with the Paris Club situation, leading to a reduction in potential debt.
Furthermore, Mr. Adongo noted that the timing of Ghana’s involvement with China is not good because other African countries are also seeking aid from the same source.
He explained that whatever China agrees with Ghana must also be fair to other African countries that seek assistance.
Finally, Adongo expressed his disappointment at Ghana’s lack of progress in achieving debt sustainability, despite the government’s efforts to reduce the country’s debt stock through the domestic debt swap programme.
He said that China does not want to forgive debts, and does not believe that a sovereign country can be poor, only bankrupt, and they hope that the country will use its assets and other things to collect money.
He said: “We need friendly countries and bilateral countries to come together and form a committee, but it is very difficult to get China to come to the table even though China is the largest bilateral lender. The complexity of the situation with China is that there are several geopolitics involved in where China does not see the Paris Club as a Western influence and would certainly like to have similar arrangements with individual countries.
“Unfortunately for us, we have come to China when other African countries are queuing up to borrow from them and it will be difficult for Ghana to jump the queue because whatever China agrees with Ghana must be fair to others. our country came to meet. And also, traditionally, China does not believe that a sovereign country can become poor, but believes that a country can be broken like we are broken but have assets and other ways to raise money and so China does not believe. forgive debts.”
Ghana’s debt
Ghana, which is suffering from an economic crisis, wants to restructure its $1.9 billion debt to China.
The country also reached a staff-level agreement with the IMF in December for a $3 billion loan, but the monetary agreement is contingent on the restructuring of the 575.7 billion cedis debt.
Ghana’s external debt stood at $29.2 billion at the end of November 2022, according to central bank data.
China’s official bilateral loan involving Ghana is less than 5% of the West African country’s total debt, China’s Foreign Ministry said on Thursday.
Source: graphic.com.gh
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