The Bank of Ghana (BoG) has provided clarity on the 22.5 billion Cedis support it extended to government in 2020 following misgivings by some members of Parliament that the move is a breach of the law.
According to the Director of Research of the Central Bank, Philip Abradu-Otoo, nothing unlawful has been done in making the funds available to government, as the total amount include funds from two programmes under the International Monetary Fund, IMF and money to support the Consolidated Bank Ghana, CBG.
In a statement Mr. Abradu-Otoo said 10 billion Cedis of the cash represented the amount that was executed within the law under the Asset Purchase Programme which allows the Central Bank, the Ministry of Finance, and the Controller and Accountant General to meet to decide on the limit of borrowing to be made by Government.
The law further states that upon agreement of the limit, Parliament should be informed, which according to him, was duly done.
The Bank subsequently paid the amount to government in two tranches, first, a 5.5 billion Cedis in May 2020 and a 4.5 billion Cedis in September same year.
Following that, the Director of Research added, the IMF Rapid Credit Facility of 1 billion dollars that was provided to government to help deal with the COVID-19 pandemic situation was lent to BoG and the bank, in turn, further on-lent this facility 5.6 billion Cedis to government.
The IMF at the time of disbursement of the facility indicated that this is to be treated as budgetary support.
He explained further that the Extended Credit facility Programme which begun in 2015, expired in 2019.
