Ghana's economy currently being run on T-Bills – Seth Terkper

A former finance Minister, Seth Terkper, has stated that the recent oversubscription that has been witnessed with treasury bills is an indication the government is relying on the instrument to sustain the economy.

Ghana is waiting to clinch an IMF-supported deal to restore macroeconomic stability sometime in March this year.

But Seth Terkper believes the instrument has become the government’s sole and primary source of borrowing as it comes as a sigh of relief that the instrument is being patronized.

Speaking during a PFM Tax Africa economic dialogue on the theme: Debt exchange, IMF programme and economic prospects on March 1, 2023, he said, “There is no other option for borrowing especially domestically. It shows some confidence that we are getting a fund programme. Confidence in the economy is a good thing.”

He added that the government is taking up all the bills being subscribed explaining that, “We are still borrowing because our debts have to be honored because of debt servicing. It will be a false impression to say that we have solved our debt issues and I hope we are not making any mistake with taking all of it.”

“It simply means that we don’t have any other options, we can’t do bonds since restructuring is ongoing. Running the economy on treasury bills is a realistic position,” he added.

Treasury bills have seen some massive oversubscription in recent times to generate questions over the government's ability to pay maturities due to high-interest rates.

Seth Terkper further recommended that the government must restore credibility to the Bank of Ghana whiles ensuring its independence is not threatened.

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SSD/FNOQ