How will Moody’s rating affect pockets of Ghanaians? – NDC asks Gov’t

An aide to former President John Dramani Mahama, Joyce Bawah Mogtari, has asked the government to explain to the public how the recent ratings by Moody’s will affect the pockets of Ghanaians.

She said Ghanaians must demand answers from the government as to how the ratings will affect their lives.

In her opinion, the government of Ghana has done little in the management of the economy especially the local currency.

To the extent that the Cedi continues to drop against the major trading currencies, she said on Metro TV’s Good Morning Ghana programme Monday January 27, the government cannot take respite in ratings.

International credit rating agency, Moody has reaffirmed Ghana’s credit rating at B3 with an upgraded outlook to positive from stable. This credit rating position is the best Ghana has received from Moody’s in the last decade.

A statement issued by Moody on Friday, 24th January 2020 stated that “Moody’s investors Service (Moody’s) has today reaffirmed the Government of Ghana’s long-term issuer and senior unsecured bond ratings at B3 and changed the outlook to positive from stable.”

The statement continues that “the decision to assign a positive outlook reflects Moody’s rising confidence that the country’s institutions and policy settings will foster improved macroeconomic and fiscal stability over the medium term, in part as a consequence of the reforms implemented under the recent IMF reform program. Those reforms are beginning to bear fruit, as seen for example in the return to primary fiscal surpluses, measures to smooth the debt maturity profile and increasingly sustainable growth prospects.

“Pressures and risks remain, as evidenced by persistent revenue challenges, a potential repeat of pre-election fiscal cycles, and the emergence of significant arrears and further contingent liabilities in the energy sector, all contributing to rising public debt. The positive outlook reflects increasing confidence that the government will manage those pressures in such a way as to sustain and enhance external and fiscal stability”.

But Mrs Bawah Mogtari, also a former Deputy Minister of Transport said: “How will all of these translate into the pockets of the good people of Ghana? That is the question we should be asking.”

Regarding “the Depreciation of the cedi nothing has been done to stem it. All these committees [FX Committee] are all just part of the facade to create a certain (impression) of activities going on but the reality is that it is not translating in the pockets of the people who voted for this government largely based on the promises that were made.”

The Government through the Ministry of Finance has inaugurated the FX Committee to among other things look into the causes of the rapid fall of the cedi against the dollar.

The Committee is chaired by Finance Minister Ken Ofori Atta.