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Authenticity Is Our Hallmark

In a candid diary, Ghana’s finance minister explains how he is tackling the looming crisis.

It’s 5am and I stir. My stomach feels cramped. I have slept no more
than four hours. My mind races.

The problems cascade through. I hear the
birds and do my meditation. My wife Angie and I are in the middle of an
Easter study on the Book of Daniel, and I can’t help but think of the
writing on the wall:

“mene mene tekel upharsin.” Have we been weighed
and found wanting? But I am optimistic there will be a few who will
stand up and become modern-day martyrs, not only to defeat this pandemic
but to create a new era.

On our minds is the question of surgical and N95 masks for healthcare
professionals. I make two calls to China to speak to our ambassador
about ventilators, and another to Israel to a fellow from the Aspen
Global Leadership Network about face masks, gloves and other forms of
protection, and discuss a charter of a plane to bring these items to
Ghana. Then a follow-up call to Vera Songwe, head of the UN Economic
Commission for Africa, and Tito Mboweni, South Africa’s finance
minister, to formulate our strategy for debt relief and commiserate on
the downgrading of South Africa’s sovereign rating. Are the rating
agencies beginning to tip our world into the first circle of
Dante’s Inferno?

It’s time to go to work and I grab my made-in-Ghana face mask. First,
though, we call Dad and Auntie Ellen. They are in their eighties and we
can’t visit them. I drive into Accra, which is in

Life & Arts Ken Ofori-Atta: ‘What does an African finance minister
do now?’ In a candid diary, Ghana’s finance minister explains how he is
tackling the looming crisis

lockdown — a strange and eerie feeling of apocalypse. Where are the
schoolchildren, the women frying doughnuts, the newspaper sellers, the
beggars? Where are our youth selling everything from dog chains to gum?
The street supermarket is gone, replaced by police and military officers
ensuring people stay at home. Our economy is over 90 per cent informal,
and the informal market is in lockdown. Growth in GDP, which was
projected at 6.8 per cent, could fall to 1.5 per cent, according to our
projections. How long can we sustain this?

I arrive at the office, park my car, wash my hands under running
water in front of the ministry. My temperature is checked: 35.6C. It
must be a good day. I am given hand sanitiser and go upstairs to my
office. We are focusing on three priorities: presenting to parliament on
the alleviation programme; a post-Covid-19 strategy for a more
resilient economy; and a co-ordinated African effort to get support for
international debt relief.

I look at the schedule for the day with Michael, my special
assistant, and it is almost surreal. We had had such a great start to
the year with a landmark $3bn eurobond issue (whew! A lifesaver, as the
markets are now closed).

 In the past three years, we had successfully
completed an IMF programme, brought inflation down and acted to ensure
fiscal discipline. Then the Covid-19 pandemic struck, potentially wiping
out 10-15 per cent of our GDP.

The president was swift and decisive: requesting a $100m preparedness
plan, ordering the borders closed, quarantining all airline passengers
for at least 14 days and ordering mandatory testing. We also introduced
social distancing, and closed schools, churches, mosques and places of
entertainment. The race was on for contact tracing, testing and
treatment.

Economic activity has been massively disrupted; hotels are closing,
industry is tottering, airlines are grounded, and our
toast-of-the-region airport lies asleep.

The Bank of Ghana cut rates by
150 basis points and reduced the reserve requirements by 2 per cent,
enabling banks to increase their lending to the private sector by some
$500m — a good effort, but an underwhelming response to what should be
done.

 I need answers.

A U-shaped recovery is touted, but ours will likely be a steep drop,
then a two- to three-year downward slide before a recovery; a
trapezoid-shaped recovery!

Back to completing our schedule for the day. [Bank of Ghana] governor
[Ernest] Addison and I finish Ghana’s application for the IMF’s
rapid credit facility. However, Ghana and Africa desperately need fresh
capital. We will work with the World Bank for a renewed approach. (I
wonder what past bank heads such as [Robert] McNamara and [James]
Wolfensohn would have been thinking at this time.)

We are interrupted by a call. One of our major partners in the energy
sector from Europe has triggered a letter of credit facility for $200m.
I am outraged at such callousness. I am reminded of the parable in
Matthew where a man’s debt is forgiven, but he then finds the fellow
servant who owes him and has him thrown in jail. I am now even more
convinced that the African finance ministers’ proposal for a debt
standstill and issuance and/or mobilisation of special drawing rights
should be extended for two years and not be limited to low-income
countries only.

So, what is the world coming to? Extraordinary times, sobering times.
Ghana, at the last count, had 636 cases and eight deaths. Analysis by
the University of Ghana’s Noguchi Memorial Institute for Medical
Research indicates that about four-fifths of the first 300 cases were
direct imports; the virus’s genetic sequencing shows its origins are
from Wuhan through Norway, the UK, Saudi Arabia, Hungary and India.

What does an African finance minister do now? How can we restore
10-15 per cent of GDP over a two- to three-year period? This is not a
passing blizzard, as a friend said; more like a long winter, even a mini
ice age. But there are some structural elements that need fixing; our
health sector, digitalisation of the continent to formalise our
economies; and Africa’s debt — the most controversial element and the
topic of much discussion. Africa’s external debt stock is more than
$700bn. Africa needs to pay $44bn to service our debt this year.

The world is changing. The German chancellor doesn’t want to hear
about debt-to-GDP ratios. Unthinkable stimulus packages are being
announced, trumping orthodoxies and with no talk of a moral hazard: the
G20 packages may end up close to $8tn. Their generous tool kits are not
available to us.

I am green with envy. To be honest, there is a lump in my throat as I
think of Africa’s predicament. I question the unbalanced nature of the
global architecture. I have, in one fell swoop, lost more than $1bn of
revenue as domestic taxes continue to shrink, compounded by lost
productivity and job losses. We still have an obligation to service our
debt portfolio.

These are grave times, surpassing the Spanish flu epidemic in 1918.
Where is the leadership and global task force that would mirror the 1944
Bretton Woods monetary conference?

This unprecedented crisis has brought capitalism “to a juddering
halt”, as Arundhati Roy wrote in FT Weekend. I think of Ben Okri’s poem
[with the line] “Will you be at the harvest?” where he inspires us to
remake the world for a new era through our human genius, so our future
becomes greater than our past.

It is 1am. We have had a long day. We had to launch a sanitation
campaign; we had video and teleconferences with [former UK prime
minister] Gordon Brown, African finance ministers, the World Bank’s
David Malpass and Kristalina Georgieva of the IMF, the Center for Global
Development and the faith-based organisations — our partners in
distributing food. I have also been tested for Covid-19 and am anxiously
awaiting the results. I am sleepy. I murmur through Psalm 23: “The Lord
is my shepherd . . .”

By Ken Ofori-Atta

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