The Institute for Fiscal Studies, a Think Tank, owned and financed by Dr. Kwabena Duffuor, the beneficial owner of the now in receivership, Unibank Ghana Limited, and a former Finance Minister and Governor of the Bank of Ghana, has petitioned the Appointments Committee of Parliament not to approve the nomination of Ken Ofori-Atta as finance Minister in the 2nd term government of President Akufo-Addo.
According to the six (6) page petition of the Institute for Fiscal Studies, they are of “the view that Mr. Ken Ofori-Atta, the former Minister of Finance, has caused financial loss and created potential financial crisis for Ghana in the last four years as Finance Minister that makes him unsuitable to be the Finance Minister for the second time” the think tank claims in the petition submitted to Parliament.
The Institute says in their petition that five main issues have led them to draw the conclusions they are making.
One is the charge of “fiscal mismanagement”. Ghana’s debt stock shot up last year as the global pandemic led to revenues dropping and COVID-related expenditures increasing.
Two, the IFS criticizes Mr. Ofori-Atta over the issuance of sovereign bonds and, what they describe as “its damaging implications.” Thirdly, the think tank cites weak domestic revenue mobilization. The fourth issue is the Agyapa Royalty deal, which seeks to minutiae royalties from some 16 mining concessions in the country through dual listing.
They see the selection of Databank as transaction advisor in partnership with the main transaction advisor. Imara, in the process of listing Agyapa on both the London Stock Exchange and the Ghana Stock Exchange, as posing a conflict of interest situation.
The Finance Minister is a co-founder of Databank, which was founded 30 years ago and has won 8 annual awards as the best securities company in Ghana. Information available to Asaase News, however, confirms that Databank pulled out of the transaction last December, three days after the general elections, and a day after the president was declared as winning a second term.
Ironically, Dr. Kwabena Duffuor also sought to do a similar deal of monetizing Ghana’s gold royalties around 2010-2012 when he was finance minister, but the preferred structure then did not work and was abandoned after the 2012 elections, when he was replaced by his deputy, Seth Tekper.
Dr. Duffour, a former Governor, also founded Star Assurance and Unibank and both did legitimate business with Government when he was Finance Minister. The fifth issue raised is the move by the Akufo-Addo Government to set up the National Development Bank, to be dedicated to be actively driving the transformation agenda of the Ghanaian economy.
“The four years of Ken Ofori Atta as Minister of Finance witnessed a very poor fiscal management in Ghana, leading to uncontrollable rising public debt with serious implications for debt sustainability, raising concerns about a new sovereign debt crisis in the country,” IFS claims.
The Institute argues that “Ghana’s development cannot be tied exclusively to the issuing of foreign loans which have serious implications for macroeconomic performance, domestic savings, and foreign exchange. It would, in fact, be suicidal and a dangerous experiment that will harm future generations for the country to have gone for a US$50 billion century bond proposed by Ken Ofori Atta without a blueprint that carefully outlines the development priorities of the country and how the funds will be used to add value to the vast resources of the country. Ghana cannot continue to always service its debt with new debt”.
The IFS has taken issue with some of the equity options for the yet to be set up bank. “Ken Ofori Atta is also busy trying to establish a national development bank, using funds borrowed from international financial institutions and part of the deadly covid-19 pandemic funds which have been mobilized to protect lives and livelihoods. The sad aspect of this is that government will in the end not be the majority shareholder of the bank.
Based on the above facts and developments, the IFS is of the view that Ken Ofori Atta has caused serious financial loss and created potential financial crisis for the country in the last four years as a Finance Minister. Ghana cannot afford to have Mr. Ofori Atta re-appointed as a Finance Minister for another four years” Dr. Duffuor’s think tank said in the conclusion of the petition.
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