A Deputy Ranking Member on the Finance Committee of Parliament, Isaac Adongo has accused President Nana Addo Dankwa Akufo-Addo of turning Ghana’s economic ratings into a diplomatic negotiation of the Africa Union.
President Nana Addo Dankwa Akufo-Addo, speaking at the 35th Ordinary Session of the Assembly of the AU in February, challenged AU members to collectively work towards building and strengthening the union’s financial institutions.
The president’s comment was on the back of the downgrading of Ghana’s economy by several international rating agencies.
Fitch, in January 2022 downgraded Ghana’s economy from B to B- with a negative outlook while Moody’s also downgraded Ghana’s economy from B3 with a negative outlook to Caa1 with a stable outlook.
The new ratings, according to the agencies, was a reflection of Ghana’s challenges in fixing its liquidity and debt challenges.
On the side of the government of Ghana however, the rating agencies without recourse to impact Ghana’s ability to access funding on the world market, downgraded Ghana without considering several factors.
But speaking on Thursday, February 10, 2022, edition of Good Morning Ghana, Isaac Adongo maintained that Ghana’s economy as it stands is indeed in distress.
“There is no remarking in economic ratings. So Ken Ofori Atta, Akufo-Addo, who have turned ratings into a multilateral diplomatic negotiation of AU should understand that there is nothing like that in economic rating.
“The only way of getting a better rating is to do the difficult task of fixing your economy so your score becomes better. That was the only way,” he stated.
Ghana’s ministry of finance in February appealed against the downgrading of the economy by Moody’s and Fitch.
The ministry citing the omission of certain key information by the agencies in their analysis, also questioned the agencies refusal to consider deferring the rating until it had taken enough time to fully understand both the quantitative and qualitative aspects of Ghana’s credit story.
The ministry in a statement said it found it puzzling the decision to downgrade Ghana despite the series of progressive engagements it had with the team from Moody’s, the quality of the data supplied, as well as the medium-term economic and fiscal focus of the government, underpinned by some key fiscal consolidation reforms.
“Perhaps, this singular action by Moody’s confirms the notion held by many that there is an urgent need for reforms in the conduct of rating agencies given their ownership structure and the ramifications that their actions have on Sovereigns especially in Africa. The call for rating reform which was loud during the peak of the COVID-19 pandemic must be revived as a matter of urgency”, the statement added.
But speaking on Good Morning Ghana, Isaac Adongo who is a member of the opposition said “rather than dealing with the matter, you are here complaining. Since when did rating agencies come here to do surveys to calculate your inflation? Since when did rating agencies come here to do surveys to calculate our gross domestic product?
“They rely on the data you have provided on the economy. They rely on the data they get from other multinational organizations such as the IMF and the World Bank and they come to a conclusion based on the health of your economy,” he stated.
The Deputy Ranking member insisted that Ghana’s downgrading was purely borne out of data received on the economy and reflective of the actual status of the country’s current economic conditions.
Source: ghanaweb
