Gov’t lied in $1bn Eurobond disbursement – Minority

• Posted on December 11, 2014December 11, 2014
• by Nana Kwesi Coomson
• Comment

The Minority in Parliament says it has evidence the $1 billion Eurobond secured by government in September this year was used to settle debts owed to the Bank of Ghana.
It says government lied when it said the money was used to finance ongoing capital projects.
Addressing a news conference in Parliament yesterday morning, Minority spokesperson on finance, Dr Anthony Akoto Osei said evidence from the Bank of Ghana’s monthly monetary survey reveals the money was absorbed by the bank to settle part of government’s indebtedness.
Dr Akoto Osei challenged government to provide details on what the Eurobond was used for.

The controversy about the $1 billion Eurobond saga was triggered by Dr Mahamudu Bawumia, running-mate to the NPP flagbearer, Nana Akufo-Addo.
Speaking to a group of UK-based Ghanaian professionals at a breakfast meeting in London, the former Deputy Governor of the Bank of Ghana said the proceeds from the bonds have been misappropriated.
“In the prospectus that sought to convince investors, the Minister of Finance indicated that a substantial portion of the amount borrowed will be used for infrastructure development and critical projects.
“What projects did the Minister have in mind? The Minister should list and provide a detailed plan of what projects he has in mind.
“We are reliably informed that the amount raised has been used largely to reduce the government’s indebtedness at the Central bank and that the funds are not available anymore for the purposes for which it was raised,” he stated.
The allegation was dismissed by officials at the Ministry of Finance.
Government spokespersons said part of the Eurobond cash was disbursed for the construction of Kasoa by-pass as well as the Kwame Nkrumah Circle project in Accra.
But the Minority says it has incontrovertible evidence to support the claim that the $1 billion Eurobond cash was used to retire debts owed to the Bank of Ghana.
According to Akoto Osei, the bond was oversubscribed because of the capital investment the government promised it was going to use the money for, only for it to turn around to use it to pay debts.
He said some of the projects the government claimed it used the money for date back to 2010, and wondered how monies raised in September 2014 could have been used to fund those projects.
Dr Anthony Akoto Osei said there is even a bigger controversy raging between the president and the Governor of the Bank of Ghana, Dr Kofi Wampah, on the same matter.
According to him, President John Mahama had given a directive to the governor not to absorb the $1bn Eurobond cash, but the Governor, Dr Kofi Wampah, had no choice but to “swallow” the money.

He explained the Bank of Ghana had exceeded its debt threshold, which was in flagrant violation of the law setting up the bank, so the governor had to reduce the debt with the revenue from the Eurobond.
Deputy Minority Leader, Dominic Nitiwul, who was also at the press conference, said the governor was torn between the devil and the deep blue sea and had to take a decision to use the money to settle government’s ballooning debts.

-The Finder