The Minority in Parliament has cautioned the government over its decision to return to the bond market, warning that recent fiscal missteps and data manipulations could negatively impact investor confidence and derail the country’s economic progress.
They argued that the timing of the announcement coincided with the government’s release of elevated fiscal deficit figures, which have led to adverse economic consequences, including increased borrowing risks.
“It is surprising nevertheless that notwithstanding the improvement in the debt environment, the timing of the announcement to open the bond market coincided with the announcement of the elevated fiscal deficits, a condition that exposes the country to high risk of borrowing from the markets.
“The effects of these unfortunate data manipulations are already hitting our economy,” they warned at a press conference in Parliament.
Led by the former Finance Minister, Dr. Mohammed Amin Adam, the Minority pointed to the widening of the country’s sovereign bond spreads, which have increased to nearly 700 basis points (bps) from the 500s just three months ago, reversing gains made previously.
“Why do we want to destroy the gains we have made through such cheap politics?” the Minority quizzed.
Negative Market Reactions
The Minority cited Bloomberg’s report on March 11, 2025, which detailed how Ghana’s dollar sovereign bonds suffered declines following the Finance Minister’s budget presentation.
“Bloomberg reported last Tuesday, March 11, the very day the Budget was presented to Parliament that Ghana’s Dollar sovereign bonds were among the worst performers in emerging markets after the Finance Minister said the country missed a primary budget balance target for 2024.
“Dollar bonds due in 2035 declined 1.8% to 70.91 cents on the dollar, while notes maturing in 2029 fell 1% to 86.965 cents on the dollar,” Dr. Adam added.
The Minority warned that inaccurate fiscal data manipulation to create a negative economic narrative was contributing to these adverse market reactions.
“So, you see, if you cook figures to create a narrative to run your country down, international investors will show you where power lies,” he asserted.
Fiscal Deficit Concerns
The Minority also challenged the fiscal deficit figures presented by the Finance Minister, arguing that the inclusion of GH¢49.2 billion in “unreleased claims” artificially inflated the deficit numbers.
“Sadly, if you took out the GH¢49.2 billion introduced in the fiscal framework, the overall fiscal deficit would be 3.4% and not the 7.6% announced by the Minister; whilst the primary balance on commitment would be a surplus of 0.6% and not the 3.1% the Minister churned out. Indeed, both the overall deficit and the primary balance would be better than the targets in the 2024 budget as well as the IMF targets for the next IMF Review to be conducted in April 2025,” Dr. Amin Adam said.
The Minority lamented the missed opportunity to present a more accurate and positive economic outlook, suggesting that such an approach could have boosted investor confidence instead of undermining it.
“I am wondering how well the international markets would have responded to the Budget if an accurate picture was put out. Ghana is the loser. A big opportunity missed because of unhealthy politics,” Dr. Adam stated.
IMF Review Risks
The Minority warned that the negative reactions from the international markets could worsen if the IMF Review in April 2025 fails due to the manipulated fiscal data.
“The reaction of the international markets will even be worse than this in the event that the IMF Review fails because of the manipulated data used by the government.
“In good conscience, we believe that the IMF will be fair to the Ghanaian people by holding on to the agreed method of computing fiscal data during the Review, as they did in all the previous Reviews. Otherwise, it is the Ghanaian people who will suffer and not the politicians,” he intimated.
Recalling past incidents, the Minority referenced Ghana’s previous $39 million fine by the IMF for misreporting economic data under the NDC government led by President Jerry John Rawlings.
“It appears we are on our way there under another NDC government. We wish to advise the Minister to tread cautiously in order not to derail our march to sustainable debt levels,” he said.
Legacy of Economic Stability
Despite the government’s misreporting, the Minority insisted that the strong economic foundation laid by the NPP remains evident in key indicators.
“The manipulation of the fiscal data notwithstanding, the strong health of the economy the NPP handed to the new NDC government continues to be vindicated by other economic indicators,” they noted,
They credited the significant reduction in the country’s debt-to-GDP ratio to the NPP’s economic strategies and skilled negotiations.
“The Debt-to-GDP ratio of 61.8% achieved in 2024 was not by accident. It was due to skilled negotiations and the implementation of a good debt strategy. The Minister could not even acknowledge this important development by the imminent absence of this ratio in his budget speech. Sad! Whether we like it or not, it is historic, and history indeed will be kind to the Nana Akufo-Addo Government,” Dr. Adam said.
By Ernest Kofi Adu, Parliament House