Samuel Okudzeto Ablakwa, a member of parliament for North Tongu, has noted a notable difference between Kwasi Kwarteng, a finance minister of Ghanaian heritage serving in the UK government, and Ken Ofori-Atta, the finance minister of Ghana.
He claimed that the former is “stiff-necked” and unyielding in his decisions, whilst the latter is more humble to acknowledge his mistakes and make adjustments.
Ablakwa’s comment comes on the back of a U-turn made by the UK’s Chancellor of the Exchequer (Finance Minister), Kwasi Kwarteng, on plans to cut the 45p rate of income tax – a move which saw a revolt by Tory MPs – hours before his speech to the Conservative party conference, BBC reported
The cut according to UK’s Evening Standard would have seen abolishing the tax rate for people earning more than £150,000 in the middle of a cost-of-living crisis.
In a Facebook post on October 3, Ablakwa said Ofori-Atta has remained headstrong despite the fact that the economy under his stead has seen downgrades from rating agencies.
He wrote: “it seems to me of the two under fire Ghanaian Finance Ministers, Kwasi Kwarteng has the humility to listen and concede quickly that he got it wrong while his counterpart, Ken Ofori-Atta remains stiff-necked, intransigent and adamant as he attracts more calamitous downgrades”.
Ghana’s economy has fared badly in the last couple of months with economists pointing to record high inflation rates, fuel price hikes, and the Cedi depreciation as the basis for their claim.
Government has consistently blamed the situation on the ravages of Covid-19 and the ongoing Russia-Ukraine war but has assured that it is implementing measures to mitigate the impact such as seeking an IMF programme in the interim.
This has been occasioned by downgrades from rating agencies such as Fitch and Standards and Poor. Recently, the International rating firm, Moody’s Investors Service also downgraded Ghana’s long-term issuer and senior unsecured debt ratings to Caa2 from Caa1 and placed the ratings on review for downgrade.
According to Moodys, the downgrade reflects the recent macroeconomic deterioration of Ghana’s economy which resulted in further heightening of the government’s liquidity, debt sustainability difficulties and posing an increased risk of debt default.
“Without external support, the government’s policy levers to arrest a worsening macroeconomic backdrop and heavier debt burden are extremely limited; the government’s small revenue base, large and increasingly absorbed by interest payments, further intensifies the policy dilemma between competing objectives, including servicing debt while meeting essential social needs,” Moody’s said on its official website on September 30, 2022.
It however explained that the initiation of the review for downgrade is prompted by the ongoing negotiations between the government of Ghana and the IMF over a funding programme that may include a condition for debt restructuring to ensure debt sustainability.