According to Isaac Adongo, the deputy ranking member of the finance committee of parliament, Ghana's request for China to cancel its debt is not likely to be granted given China's current economic and geopolitical position.
Mr. Adongo stressed that China's political and economic worldview is incompatible with the requirements of the Paris Club in a radio interview with Citi FM last Friday, which makes any prospective debt reduction difficult.
Mr. Adongo further pointed out that Ghana's timing in contacting China is unfavorable because other African nations are also looking to the same source for assistance.
He clarified that everything China agrees to with Ghana must also be fair to the other aid-seeking African nations.
Adongo concluded by expressing dissatisfaction that, despite government attempts to lower the country's debt load through its domestic debt exchange program, Ghana has not made headway toward debt sustainability.
He bemoaned China's unwillingness to forgive debts, saying that they don't think a sovereign country can be impoverished, only broke, and that they anticipate nations to utilize their assets and other legal ways to recoup their obligations.
Even though China is our largest bilateral lender, he said, "It has been challenging to convince China to come to the table." We need our friendly countries and the bilateral countries to join together and create a committee. Because China views the Paris Club as nothing more than a Western influence and constantly wants to have equal agreements with other countries, the China scenario is complicated by various geopolitical factors.
"Unfortunately, we arrived in China at a time when other African nations were already waiting in line to borrow from them." As a result, Ghana won't be able to skip that line since whatever China does with Ghana must also be fair to the other nations we met. Moreover, China historically rejects the idea that a sovereign nation can be impoverished but accepts that a nation may be destitute, as we are, while still possessing assets.
China doesn't believe in forgiving debts since they have other ways to get their money.
Debts of Ghana
Ghana seeks to restructure $1.9 billion of its debt to China to escape its current economic difficulties.
In December, the nation also reached a staff-level agreement with the IMF for a $3 billion loan; however, the funding is only approved if the nation restructures its 575.7 billion cedi debt.
According to figures from the central bank, Ghana's external debt was at $29.2 billion at the end of November 2022.
According to the Chinese foreign ministry, less than 5% of Ghana's overall debt is made up of formal bilateral loans from China.
blogpay
Total Comments: 0