Ghana hits referee trouble – in the markets and in the World Cup

By Jonas Nyabor
Posted on Friday, 25 November 2022 18:05

A Ghana supporter cheers on November 24, 2022. (Photo by Khaled DESOUKI / AFP)

Portugal’s defeat of Ghana’s Black Stars – courtesy of a contested penalty granted to Cristiano Ronaldo – in the World Cup on 24 November rankles with the country almost as much as its treatment in the financial markets. On both counts Ghana has expert opinions on its side.

On the Qatar match it was British professional referee Mike Dean who queried why the US referee Ismail Elfath declined to test the claimed foul against Ronaldo in Qatar with the Video Assistant Referee.

Or Portugal’s defeat of Ghana’s Black Stars in the World Cup on 24 November rankles with the country almost as much as its treatment in the financial markets. in the global markets, it is the myriad bankers working in Africa who claim that Ghana gets an unfair rap with the big three international ratings agencies compared with a serial defaulter like Argentina, the world’s biggest borrower from the IMF.

Ofori-Atta’s budget

Apart from Ronaldo’s penalties, the other issue for Ghanaians on 24 November was their finance minister Ken Ofori-Atta’s appearance in parliament bearing his budget proposals for 2023.

It was to be a battle royale with the opposition National Democratic Congress seeking enough dissident MPs from the ruling New Patriotic Party to block the budget speech until President Nana Akufo-Addo sacked him. That would have taken two-thirds of the MPs in parliament.

The NDC’s hopes of success were high because a month ago, about 80 rebel MPs from the ruling party had been calling for the exit of Ofori-Atta. But after the NPP’s barons and the president called in the rebels for a chat, the idea of blocking Ofori-Atta was dropped again.

Instead opposition MPs are trying new tactics.  In protest against Ofori-Atta’s role, they are refusing to back any new loan approval requests made by the government.

  • This week NDC MPs blocked three of the government’s loan requests amounting to $500m.

Of the three, $150m was for a primary health care programme; $200m was to finance the Ghana Digital Acceleration Project; and $150m to support the public finance management for service delivery programme.

Spiralling debt

The MPs argued that Ghana’s spiralling debt obligations made it unreasonable to contract more loans.

The Ministry of Finance puts Ghana’s debt to GDP ratio at 75.9% as of September 2022  – but the IMF projects it to reach 90.7% by the end of 2022 while the World Bank suggests that the rate will hit 104.6% in the same period.

“We are in a debt distress situation because our debts are unsustainable and so it is difficult to support the government.”

“If you are in a pit …the first thing is to stop digging, that is why we cannot continue approving loans in a situation where we know our debts are unsustainable,” former deputy finance minister and opposition MP Cassiel Ato Forson tells The Africa Report.

With a hung parliament of 137 parliamentarians on each side of the aisle, the opposition has the muscle to push out government bills amidst calls for the exit of Ofori-Atta. He is already facing a vote of censure in parliament over claimed economic mismanagement and conflicts of interest.

Major upset

The opposition’s tactics are disrupting the government’s programmes. Minister for Communications and Digitalisation, Ursula Owusu-Ekuful told journalists in Accra that the government will try to persuade the opposition to shelve its tactics.

“We are having economic challenges but digital technology provides us with a ladder to climb out of the difficulties we currently face so even though the Minority has taken a decision that they will not approve any loans presented before the Finance Committee, I urge them to take another look at their position, but we are going to have further engagements with them”, she said.

In recent weeks, government ministers have conceded the country is debt distressed. On 24 November deputy Finance Minister John Kumah told the poplar Joy FM radio station that the government is about to open negotiations with foreign bond holders about restructuring Ghana’s debt. They could be asked to take haircut of up to 30% he suggested.

Ghana is negotiating a $3billion credit with the of which a primary condition is that its debt obligations have to be sustainable.

The deal will require tough public spending cuts but could provide an economic  breathing space and stop further deterioration. Last month, inflation hit a record 40.4% up from 37.2% in September. And the cedi emerged as the worst performing currency in the world according to Bloomberg after it fell over 40% to the US dollar.

“We are determined to secure these [IMF] arrangements quickly to bring back confidence and relief to Ghanaians. Government is taking to stabilise and grow the economy, as well as shore up our currency,” president Akufo-Addo said in a televised address late last month.

But Ato Forson says the NDC MPs will need to be convinced by the government’s economic recovery plan before they drop their tactic of opposing requests for new loans.

“Government should tell us what they intend to do to make the debts sustainable and then we can take decisions for them. We will not be part of any wishy-washy economic management and so we want to see a roadmap for debt restructuring – debt to GDP must be at 55% from the current 100% – if that is done we will approve the loans but until then there is a complete fiat,” said Forson.



Understand Africa's tomorrow... today

We believe that Africa is poorly represented, and badly under-estimated. Beyond the vast opportunity manifest in African markets, we highlight people who make a difference; leaders turning the tide, youth driving change, and an indefatigable business community. That is what we believe will change the continent, and that is what we report on. With hard-hitting investigations, innovative analysis and deep dives into countries and sectors, The Africa Report delivers the insight you need.

View subscription options