BoG complied with law in Eurobond dispersal
The Bank of Ghana (BoG) complied with its Act and the country’s laws in the disbursement of the $250 million Eurobond proceeds to the Ministry of Finance for onward investment at United Bank of Africa (UBA) Ghana Limited, the Governor of the Central Bank, Dr Abdul Nasiru Isahaku, has said.
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As a custodian of all foreign exchange resources of the country, the governor said the bank ensured that the cedi-equivalent of the money, not the $250 million, was given to the ministry when the request was made.
That, he said, was in line with the BoG Act, (2002), Act 612, which mandates the central bank to keep the nation’s forex and sell same to the government whenever it requests the funds.
“It is our right to keep all forex in the country and we will resist any attempt to take it out of here to anywhere,” he said at a press conference in Accra.
The debate
He was commenting on the raging debate between the 2016 running mate of the New Patriotic Party (NPP), Dr Mahmudu Bawumia, and the Minister of Finance, Mr Seth Terkper, on the transfer of $250 million into an investment scheme at UBA.
The amount was part of the $1 billion raised through a Eurobond to help finance infrastructural development and repay maturing debts. It was to serve as seed capital for the Ghana Infrastructure Investment Fund (GIIF), which is yet to take off.
Given that the structures needed for the smooth take off of the GIIF were still ongoing, Mr Terkper explained that his outfit decided to move the proposed seed capital into an investment scheme rather than leaving it idle.
That move has since returned some $23 million in interests, the minister said.
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Dr Bawumia, however, said such an action lacked economic prudence and also contravened the BoG Act, which makes the bank the only custodian of the country’s forex.
He thus called for the resignation of the minister and a Parliamentary inquiry into the circumstances surrounding the action.
But answering questions from the media on the matter, the BoG Governor said his outfit played within the law in the transfer of the funds.
“When the ministry requested the funds, it was the cedi-equivalent that we gave to them, not the dollars. Our mandate is to be custodians of all forex and that is what we did in this case,” he said.
Dr Isahaku, however, declined to comment on the investment of the funds, explaining that the bank’s role in such matters normally ended with the selling of the forex to the government.