An Economist who lectures at the Kumasi Polytechnic, Kusi Boafo, has described as a cleverly schemed move for personal interest, the Finance Minister, Mr. Seth Terkper’s decision to borrow $250 million and pay interest on it by keeping it at a private bank, United Bank for Africa (UBA).
He claimed this is a very bad precedence in the management of the economy and has therefore called for a serious probe into the matter to unravel the intent behind it.
“I don’t see the sense in it” he noted, adding, “There is no value for money in this transaction; this is literally bedding and breakfasting for UBA”.
Mr. Boafo claimed if the same amount of money involved in the controversial transaction had been deposited at either of the banking institutions largely owned by government – Agric Development Bank(ADB) or the Ghana Commercial Bank (GCB), all the returns accruing from the investment would have gone to government to enable it benefit more from the value chain.
He questioned the kind of negotiations that went into the decision that informed Mr. Terkper to settle for such transaction when the interest to be accrued from the credit for UBA is way below the country’s current inflationary threshold.
“The credit was given at a concessionary rate – because even a rural bank manager or a student learning basic banking should even know that nobody will give out a loan which its returns is below the inflationary rate. It doesn’t make sense in the investment circles” he noted.
The NPP’s running mate, Dr. Bawumia addressing students of the Accra Polytechnic last week accused government of diverting about $250 million of the total proceeds from the nation’s $1 billion Eurobond it issued in 2015 to a private account at the United Bank of Africa (UBA).
According to him, the fund was not yet operational. However the Finance Minister at a news conference on Monday to respond to Dr. Bawumia’s claims, said “government acted within the law”.
