Home / News / Government still stands a chance for loans from external creditors despite defaulting – Prof. Quartey

Government still stands a chance for loans from external creditors despite defaulting – Prof. Quartey

 

Director of the Institute of Statistical, Social and Economic Research (ISSER) of the University of Ghana, Professor Peter Quartey, has expressed optimism that the government will be able to secure some funds from external creditors after defaulting on loans.

This comes after the government, through the Ministry of Finance, indicated its inability to service dept including Eurobond, commercial loans, and most bilateral loans.

According to Ken Ofori Atta the sector minister, the suspension of the payments was an “interim emergency measure” to ensure that the government gains some financial strength to help stabilize the economy.

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However, some concerned persons fear that the current trajectory of the government puts the nation at risk of not accessing loan facilities, which would exacerbate the woes of the nation.

But Prof. Quartey assuaged the fears explaining that “the fact that we have defaulted once in a loan agreement does not mean that we will forever default”.

According to him in an interview with Citi FM monitored by Angelonline.com.gh, the external creditors would “assess your present economic circumstances and then engage with you”.

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“The IMF comes with credibility and that would also attract other international or bilateral donors on board. I believe we are likely to get some bilateral funds as well,” he furthered.

However, the academic highlighted some factors that would frustrate the government’s efforts to restore economic stability, including overspending.

“The international market: it might take a while to build the credibility up to the stage we were prior to covid. I think if we are able to get on the IMF program we are able to do the right thing, we are able to manage our dept threshold; we don’t overspend like we have done, they will look at that, assess our growth rate, assess our revenue stream and we are likely to get more funds going forward,” said Professor Peter Quartey.

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