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Tag: Lord Mensah

  • Absurd! It will take 50 years to finish paying for Bawumia’s GHC2 a month smartphone – UG Prof explains

    Absurd! It will take 50 years to finish paying for Bawumia’s GHC2 a month smartphone – UG Prof explains

    A professor with the University of Ghana (UG), Lord Mensah, has rubbished Vice President, Dr. Mahamudu Bawumia’s plan to provide smartphones on a two Ghana Cedis (GHC2.00) monthly payment scheme.

    He has called it financially impractical.

    In a post on the X platform, Executive Director, Centre for Investment Advisory and Sustainable Finance (CIASF), analyzed the proposal and highlighted a fundamental flaw in the plan.

    According to him, the minimum price for an android phone in Ghana is one thousand and two hundred Ghana Cedis (GHS 1200.00).

    He added that assuming no interest is charged and payments are made consistently, buyers would take fifty (50) years to fully pay off the phone.

    Prof economist questioned the practicality of such a plan, noting that the lifespan of a phone is significantly shorter than the proposed repayment period, making the scheme financially unfeasible.

    “Minimum Android phone is GHS 1200 in Ghana. So let’s do the analysis. Assume the government is subsidizing it so the bank will lend to the buyer at zero interest rate. I don’t want to use compound and annuity effects. Let’s make it simple at zero rate. At GHS 2 monthly payment, the buyer will do 1200/2=600 times payments.

    Divide the 600 by 12== 50 years. It will take 50 years to pay for a GHS 1200 phone. Now the question is, what is the life span of a phone? How can you buy something on credit with the payment period being more than its life span? It doesn’t make economic and financial sense,” he wrote.

    During a campaign event in the Northern Region, Dr. Bawumia committed to improving access to smartphones for Ghanaians if he is elected president.

    He outlined a plan to partner with mobile phone manufacturers to offer smartphones on a credit basis.

    Under this plan, citizens would be able to purchase phones and repay them in monthly instalments as low as GHC1 or GHC2.

    Dr. Bawumia highlighted that the goal of this initiative is to bridge the digital gap and enhance connectivity across Ghana by making smartphones more accessible to the general population.

    “We will make access to mobile phones affordable,” Dr. Bawumia announced. “We plan to collaborate with phone manufacturers to set up a system where citizens can purchase smartphones on a credit plan.

    “This means buyers would pay in small, manageable amounts—just GH¢1 or GH¢2—until the full cost is covered. Our goal is to ensure that everyone has access to a smart device.”

  • MoF’s release on anti-gay bill just a tool to sow fear and panic in Ghanaians – Lord Mensah

    MoF’s release on anti-gay bill just a tool to sow fear and panic in Ghanaians – Lord Mensah

    Senior lecturer at the University of Ghana Business School (UGBS), Professor Lord Mensah, has deemed the press release by the Ministry of Finance (MoF) regarding the implications of President Nana Addo Dankwa Akufo-Addo’s assent to the LGBTQ+ bill as unnecessary.

    During an interview on Morning Starr with Francis Abban on Tuesday, Prof Mensah elaborated that the foreign support for the 2024 budget is of little significance to cause alarm among Ghanaians if it doesn’t materialise.

    “Go into the 2024 budget and look at the grants that we are targeting, which is just about 3.3 percent of our GDP. So it tells you that it’s just a microcosm of what we do in the country. We may do without them so I don’t see the reason why we should get ourselves worried,” Prof. Lord Mensah stated.

    According to him, the current International Monetary Fund (IMF) bailout for Ghana also has nothing on the LGBT+ bill.

    “Again, the IMF programme never talked about LGBTQ. So if the president goes ahead to assent the bill and we manage very well and we do what the IMF is looking out for, we should be able to get the releases.

    “The World Bank will also be supporting us because the conditions behind the World Bank was that if we are able to meet the IMF target and continue to have the programme with them, they will be supporting us,” the senior lecturer stated.

    He continued: “So it has nothing to do with the bill, the release the Ministry brought is just a panic statement that they are throwing into the system which was not necessary. Let the President do his job, he should go ahead and put his pen to the bill and then we will see what will happen.”

    Background

    According to the Ministry of Finance, Ghana faces a potential loss of US$3.8 billion in World Bank financing over the next five to six years and risks derailing the International Monetary Fund (IMF) program if the bill is assented to.

    In a statement, the Ministry outlined several challenges Ghana may encounter due to the passage of the bill by Parliament.

    “The expected US$300 million financing from the First Ghana Resilient Recovery Development Policy Operation (Budget Support) which is currently pending Parliamentary approval might not be disbursed by the Bank when it is approved by Parliament.;

    “On-going negotiations on the Second Ghana Resilient Recovery Development Policy Operation (Budget Support) amounting to US$300 million may be suspended; On-going negotiations for US$250 million to support the Ghana Financial Stability Fund may be suspended;

    “Disbursement of undisbursed amounts totaling US$2.1 billion for on-going projects will be suspended; and Preparation of pipeline projects and declaration of effectiveness for two projects totaling worth US$900million may be suspended. Full details of the World Bank portfolio are attached as Appendix 1 & 2.

    “In total, Ghana is likely to lose US$3.8 billion in World Bank Financing over the next five to six years. For 2024 Ghana will lose US$600 million Budget support and US$250 million for the Financial Stability Fund. This will negatively impact on Ghana’s foreign exchange reserves and exchange rate stability as these inflows are expected to shore the country’s reserve position,” the statement read in parts.

  • Akufo-Addo furious with rating agencies because he can’t borrow – Lord Mensah says

    Akufo-Addo furious with rating agencies because he can’t borrow – Lord Mensah says

    President Akufo-Addo’s persistent jabs at credit rating agencies, according to Professor Lord Mensah, an associate professor at the University of Ghana Business School’s Department of Finance, expose the government.

    According to him, President Akufo-Addo’s comments are because of the government’s inability to borrow from the capital market to cover up the non-performance of the economy.

    President Akufo-Addo speaking to African leaders at a tribute to the AfriExim bank accused global rating agencies of recklessly downgrading Ghana’s credit rating, effectively compounding the country’s economic woes.

    But speaking on Morning Starr with Francis Abban on Tuesday June 20, Professor Lord Mensa says the President and his Finance Minister, Ken Ofori-Atta are only upset because the country has been cut off from the international capital market.

    “If you look at the posture of the President and the Finance Minister, clearly it is the accessibility of the capital market that is the problem.

    “The capital market deals with confidence that investors will have in your economy. But by word of mouth, say that the rating agencies are being reckless and by doing so it may affect our economic performance is different,” Prof. Lord Mensah disagreed with the President’s statement.

    He continued: “We were using the capital market to shadow our non-performance of the economy, that kind of economic management where you go and borrow and come and cover up as if you have dollars meanwhile they are borrowed which you have to pay in the long run and immediately you were blocked from the international market, look are what happened to us.”

  • World Bank’s assessment of Ghana’s economy is true – Lord Mensah

    An Economist, Lord Mensah, has backed assertions of Ghana’s economy by the World Bank.

    According to him, the World Bank being an external body gives an accurate measure of the country’s debts and growth prospects.

    He noted that the stakeholders in Ghana do not capture the true state of Ghana’s situation in its accounting of the country’s debts.

    “Being an external stakeholder of this economy, it is anticipated that once in a while, they’ll come and give us their perspective of the Ghanaian economy. And truly, what they said is a reflection of what is happening on the grounds,” he is quoted by myjoyonline.com.

    He added that: “Looking at our debt, I think we’ve been calculating our debt without the contingent liabilities over the years, and if I say contingent liabilities, what I mean is the liabilities that have some inflows to them so we think it is not debt.”

    “And we should know that all those inflows that are tied to this debt operate under a certain umbrella which is the economy. So, if the economy is not doing well, obviously those inflows will also be impaired and it can affect your debt payment,” Lord Mensah explained.

    The World Bank in the latest report stated that Ghana is currently a high-debt-distressed country with a debt-to-GPD ratio of 104%.

    Meanwhile, data released by the Bank of Ghana suggested that Ghana’s public debt stands at GH¢402 billion representing 68% of GDP.

  • World Bank’s assessment of Ghana’s economy is true – Lord Mensah

    The World Bank’s claims about Ghana’s economy have the support of an economist named Lord Mensah.

    He claims that the World Bank, an external organization, provides an accurate assessment of the nation’s debts and growth prospects.

    He pointed out that in their accounting of the nation’s indebtedness, Ghana’s stakeholders do not accurately reflect the country’s predicament.

    As an external stakeholder in this economy, it is expected that they will occasionally visit and share their insights on the Ghanaian economy.
    Myjoyonline.com quotes him as saying, “Truly, what they said is a mirror of what is happening on the premises.

    He added that: “Looking at our debt, I think we’ve been calculating our debt without the contingent liabilities over the years, and if I say contingent liabilities, what I mean is the liabilities that have some inflows to them so we think it is not debt.”

    “And we should know that all those inflows that are tied to this debt operate under a certain umbrella which is the economy. So, if the economy is not doing well, obviously those inflows will also be impaired and it can affect your debt payment,” Lord Mensah explained.

    The World Bank in the latest report stated that Ghana is currently a high-debt-distressed country with a debt-to-GPD ratio of 104%.

    Meanwhile, data released by the Bank of Ghana suggested that Ghana’s public debt stands at GH¢402 billion representing 68% of GDP.