Group warns finance minister over Eurobond cash

Pressure group, Ghana Must Know Forum (GMKF), has called on the Minister of Finance and Economic Planning, Mr. Seth Terkper, to, as a matter of urgency, reverse the transfer of $250m out of the $1 billion Eurobond cash to the United Bank of Africa (UBA), or face its wrath.

According to the convener of the group, Hopson Adorye, the transaction was “fraudulent” and “criminal.”

Addressing the media in Accra on Friday, May 13, 2016 as part of the GMKF’s weekly encounter with the press, Mr. Adorye explained that the transfer of $250m to UBA contradicts section 53 of the BoG Act, which states that “the bank shall hold all foreign exchange of the State and be responsible to Parliament in the performance of its functions in relation to the foreign exchange.”

Accordingly, the group alleged that “the transaction was deliberately planned and tactically orchestrated in a well-coordinated manner, between the presidency, ministry of finance and Bank of Ghana (BoG) to use the money to finance President John Dramani Mahama’s campaign.

It would be recalled that the ministry of finance somewhere in October 2015 issued a Eurobond of $1 billion at an interest of 10.7%, of which $250m was set aside for the Ghana Infrastructure Development Fund (GIDF).

The remaining $750m of the money was to be used for the refinancing of maturing domestic debt.

But, according to GMKF, the minister of finance acting on the directive of President John Dramani Mahama secretly transferred the $250m into an account at UBA, a Nigerian owned commercial bank in Ghana, which operating capital is just $70m.

The group explained that “the Eurobond attracts an interest of 10.75% which is to be paid by Government of Ghana. However, the $250m which was deposited into UBA by the finance ministry, the bank (UBA) has, in turn, used 950 million Ghana Cedis to buy treasury bills at a rate of 24%, using the one year note.

The development, according to the group, has caused government to pay a whopping 34.75% (10.75% + 24%) as interest on the $250m.

Consequently, the group wondered why government would pay 24% interest on her own money to a foreign private bank.

“If this is not create, loot, and share deal then what is it?” the convener of GMKF asked?

Meanwhile, the GMKF has called on the Minister of Finance and Economic Planning, Mr. Seth Terkper, to do the honourable thing by resigning from his position.

The group has also called on Parliament to institute a parliamentary enquiry into the whole transaction.