Furthermore,
given the ongoing debt restructuring, citizens should also be measured in their
confidence in the financial sector rebound.
That is not all.
For David Ofosu-Dorte, he anticipates more lay-offs and downsizing by
cash-strapped organizations.
“I mean, a lot
of organizations who will not have access to money to expand including those in
the banking sector who have had the payments of their bonds deferred in the
debt exchange will downsize. So expect a lot of lay-offs and tougher times”, he
told Bernard Avle on the Point of View on Citi TV on Monday.
The government
exchanged existing bonds for new ones with a more flexible interest payment
plan as part of ongoing negotiations with the International Monetary (IMF) Fund
to secure $3 billion in economic support for Ghana.
Following an
economic downturn and difficulties in servicing its debt, the government
implemented the domestic debt exchange programme to give itself more time to
meet its fiscal obligations.
The programme
has faced stiff opposition from groups and individuals since its announcement.
A staff-level
agreement between Ghana and the IMF was achieved in December, opening the door
for the $3 billion rescue.
Before the
Bretton Woods institution’s board would evaluate Ghana’s request, one of the
requirements is the domestic debt restructuring scheme.
Without the debt
exchange programme, the government warns that the nation’s economy would
collapse severely.
David
Ofosu-Dorte however believes the financial industry and the lives of Ghanaians
do not seem to look good at the moment.
“But this time,
the tougher times will not be because of IMF conditionalities. It is the
reality of the situation. The financial sector will suffer more because people
will keep money outside the banks. People will keep money under the bed at
home, in forex or in properties like real estate. Now, there is a trend of
increasing purchases in safes and the price has even gone up so it means people
are keeping their own money”, he stressed.
By Nii Larte Lartey || citinewsroom
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