Banking and Corporate Governance Consultant, Dr. Richmond Akwasi Atuahene, has urged Parliament to place a cap on borrowing in the constitution.
This he believes will prevent the borrowing spree that has led the country into the economic quagmire it finds itself in.
According to him, the failure to quickly establish a debt limit would result in the current situation repeating itself over and over again in the future.
Speaking on JoyNews’ PM Express, Dr. Atuahene said it is about time Ghana followed in the steps of Kenya and Germany by establishing a debt limit.
“But let me finally say this. In the long term, we need to put a debt limit in the constitution. As you were saying, Kenya has now done it, 50%, you cannot go more than that because we keep on going and going and going and then we come back.
“I believe the people who look at the constitution who said the constitution doesn’t need to be amended let me assure them German has it, even Americans who borrow and over borrow they have set a debt cap. Unfortunately for Ghana, this one will borrow and borrow and borrow,” he said.
He further bemoaned the failure of successive governments to use borrowed money to expand and provide sustainable infrastructure to support the Ghanaian economy.
He noted that most often borrowed monies are used to pay compensations instead of being invested into productive ventures that may earn the country foreign exchange.
This he says must be avoided at all cost.
“But if you borrow and you don’t even put in some strategic investment that will work to pay itself, I’m sorry we’ll have this argument, this discussion the next 20 years, the next 40 years because our infrastructure cannot even support the expansion of the economy, but we keep on saying that we’re building the economy,” he said.
He added, “If you borrow to consume then you’re going to have this challenge that we have. Because it is a country that we don’t want to borrow to expand the infrastructure or the system that will bring the foreign exchange or bring the currency. But if you borrow to support some payment and what have you, refinancing, at the end of it all we’re going to have a problem.”