Finance Minister Dr. Cassiel Ato Forson has urged the Bank of Ghana to explore internal asset liquidation for recapitalization instead of relying on taxpayer funds. He emphasized the need to cut expenditures and might negotiate terms if the central bank shows commitment to resolving its financial issues.
Finance Minister Dr. Cassiel Ato Forson has firmly stated that taxpayer funds will not be utilized for the recapitalization of the Bank of Ghana (BoG). Instead, he has urged the central bank to seek internal solutions, such as liquidating some assets, to address its financial challenges. This directive follows the revelation that BoG had previously signed a Memorandum of Understanding (MoU) to receive a GH¢53 billion bailout from the government for this purpose.
During an appearance on Joy News’ PM Express, Dr. Forson emphasized the unsustainable nature of such a bailout, especially given the current fiscal constraints. He referenced a report indicating a significant GH¢60 billion shortfall, and his prior role as Minority Leader, during which he highlighted BoG’s increasing debt and its impact on the bank’s financial stability.
Despite ongoing difficulties, Dr. Forson has instructed the BoG to minimize expenditures and explore internal financial strategies, rather than imposing a financial burden on taxpayers. He criticized the bank’s recent spending decisions, particularly its investments in a new head office building, suggesting it could sell and lease back the property for funds.
The Finance Minister also recommended that the central bank divest from its guest houses and hotels to generate additional capital. He expressed concerns that using public funds to support BoG would detract from essential public services, such as infrastructure and healthcare.
While Dr. Forson has maintained a resolute position against taxpayer funding for BoG, he expressed openness to negotiations, contingent upon the central bank’s demonstrable efforts to rectify its financial challenges. He proposed a long-term approach in which BoG might gradually reinvest its profits over a decade as part of its recapitalization plan. This governmental directive sets a crucial precedent for the BoG’s forthcoming actions in addressing its financial shortcomings.
In summary, Finance Minister Dr. Cassiel Ato Forson has articulated a clear directive for the Bank of Ghana to recapitalize through internal asset sales rather than taxpayer reliance. This approach aims to safeguard critical public services by avoiding a GH¢53 billion bailout. With a focus on reducing expenditures and exploring asset liquidation, the central bank faces significant expectations to demonstrate fiscal responsibility moving forward.
Original Source: www.graphic.com.gh
