IMF deal: What we need now is creditor coordination – Prof. Lord Mensah

Economist, Professor Lord Mensah, says Ghana has underplayed the complexity of its external creditors and how they stand.

According to him, the country has failed to appropriately coordinate its creditors in its pursuit for debt relief thus causing the bottleneck that has bedeviled the process.

He has urged government to take opportunity of the ongoing IMF discussions in Washington to get creditors equally up to speed on the Ghana situation and build confidence in Ghana’s debt restructuring policy.

Speaking on JoyNews’ PM Express Business Edition, he noted that when this is achieved, it would help iron out the obstacles that have impeded Ghana’s IMF executive board approval.

“We have underplayed the complexity of our external creditors and how they stand. We look at the geographic locations of these external creditors, we’re looking at some of the conditions they gave us and how diverse they are – very, very important. What we need now as a country is what we call creditor coordination.

“Creditor coordination [is] very very important to ensure that information about Ghana, information about negotiations are equal in front of all our creditors – very very important. And I’m anticipating that the spring meeting will provide that platform for which our officers will meet these creditors, one-on-one, meet them together talking about the Paris club, looking at the commercial lenders from the Eurobond market and then also the Chinese bloc,” he said.

Explaining the current situation, he noted that due to the lack of equal and clear information on Ghana’s debt problem for creditors, some amount of uncertainty and suspicion has been created.

This, Prof. Mensah believes can be handled if all creditors are brought to speed on Ghana’s debt restructuring plans.

“So China at one bloc, the Paris club is looking at ‘o fine, if we give Ghana that kind of debt relief, they’ll use the money to pay China.’ And China is also sitting somewhere looking ‘ok fine, if we go in to provide the debt relief, you know, the money will be used to pay these Paris club countries’.

“So effectively, there’s this kind of back and forth as far as the minds of the creditor space is concerned. And that is why I mentioned earlier that we need that kind of creditor coordination to ensure that they all come at the same level when it comes to information about how we want to go about this debt restructuring,” he said.

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