Seth Terkper, a former minister of finance, has expressed worry over the Bank of Ghana’s significant deficit of GH60.8 million.
He asserts that the budget deficit is not being adequately addressed by the government through the ministry of finance, necessitating additional borrowing.
Mr. Terkper claimed that the central bank continues to print money despite the current situation in an interview on Joy News, which 1Family Radio was listening to.
“The danger of this is that the Bank of Ghana has resorted to printing money, and the government may continue to incur deficits to the point where the central bank runs out of funds,’’ he said.
He added that while BoG does finance the government’s deficit, bank regulations limit its ability to do so to a maximum of 5% of the sum it received the year prior. This law aims to avert the situation that we are currently experiencing.
Mr. Terkper indicated that zero funding was implemented in 2025 as a requirement of the IMF’s (International Monetary Fund) criteria. He stresses that the IMF ordered the apex bank to completely forgo supporting the government. This was done to improve its ability to engage with banks in the financial industry and enhance its balance sheet.
“In 2016, the government under John Mahama refrained from taking new loans from the Bank to maintain zero financing, despite having an available 5% of BoG financing to meet the IMF’s conditions,’’ he noted.
“The issue we face now is that the government continues to borrow from the Bank of Ghana to such an extent that even if we set aside domestic debt exchange, the government would struggle to repay its external creditors,’’ Terkper added.
Source: 1Familyradio