SOURCE: 3NEWS
A Financial Analyst, Johnson Ameyaw says the Bank of Ghana (BoG) overdraft to the Ministry of Finance, will go a long to help the country as the government seeks a programme under the International Monetary Fund (IMF).
In the absence of access to the international capital market and given the constrained domestic financing, central bank overdraft has helped to close the financing gap as reflected in the mid-year budget review.
Dr Ernest Addison, Governor of the Bank of Ghana (BoG) says the Bank of Ghana is working with the Ministry of Finance to agree on a cap on the overdraft.
But the Minority in Parliament raised issues saying the BoG’s overdraft is the same as monetary printing in the technical sense, which BoG denied earlier as per its statement dated July 26, 2022.
But the Financial Analyst, Mr Ameyaw further explained that because government is paying debts, it needs funds to ensure payment of salaries.
In his view, even Members of Parliament would not have been able to receive their salaries but the overdraft. “Without BOG overdraft nobody would have received salaries including parliament.
He added “Once government pays for debt service domestic revenue is exhausted.
