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The role of a Minister of Finance requires someone with an appreciation of economics as well as a working understanding of how an economy works, a thorough understanding of financial markets and public finances; and for a developing country like Ghana.
You need someone with credibility in the market nationally and internationally.
These create the respect and trust necessary for the Minister to work with relevant stakeholders on Ghana’s development agenda.
We must also be aware of the fact that a Minister of Finance must be able to protect the public purse from the pressures that come with excessive spending, sometimes even to the dissatisfaction of his own government.
As parliament prepares to consider ministers appointed for the second term of the government led by Akufo-Addo, one of the key positions that seems to have garnered a lot of attention is that of finance minister – especially in light the impact of the COVID-19 pandemic on our economic progress and the critical need for experienced, knowledgeable, creative and internationally respected leadership if we are to emerge from this COVID nightmare stronger and more resilient.
A key trend for selecting a finance minister in countries that actively participate in local and global capital markets is for the person to have a deep understanding and connection to those markets or a more than substantial pedigree in practice. of economic policy in order to markets to have confidence in the person.
Evidence of this is widespread in countries like the US, UK, among others.
For example, the current UK Chancellor of the Exchequer was a former investment banker at Goldman Sachs, the immediate US Treasury Secretary is also a former investment banker and hedge fund manager.
Others who played similar roles at critical times include Henry Paulson, Jack Lew, both of whom were investment bankers, among others.
In Ghana, significant success in navigating financial sector clean-up, which was a difficult crisis inherited from the previous government, the successful exit of the IMF without international investors worrying too much about their portfolio holdings in Ghana and the The more than successful raising of over US $ 8 billion through Eurobond issues to support budget spending in recent years is largely due to the finance minister’s pedigree.
Who is Ken Ofori-Atta? Ken was born on November 7, 1959 in Kibi. He attended the prestigious Achimota School, and subsequently obtained a BA in Economics from Columbia University in 1984, and an MBA from esteemed Yale University School of Management in 1988.
He has practiced as an investment banker in the United States and Ghana for over 30 years. His background as Executive Chairman of Databank, and through the successes of the company, he has built an enviable experience as a leading investment banker and entrepreneur in emerging markets, with a global and national understanding. financial markets and economic issues.
Ken was honored as Donaldson Fellow at Yale University and is the first African to receive the Columbia University John Jay Award, which is awarded to Columbia College alumni in recognition of their commitment to a new generation of African leaders. He was also the first African to testify before the US Congressional Ways and Means Committee in support of AGOA.
This training and experience places Ken in the league of qualified and suitable candidates for the post of Minister of Finance. It is important that the country does its best to select a finance minister over the next four years, as uncertainties remain in the global financial system.
The COVID-19 pandemic has made it even more urgent for Ghana to have a Minister of Finance whose track record breeds confidence in global economic institutions and financial markets in a way never seen before in our history. It is clear that future Eurobond issues by Ghana will have to go without face-to-face meetings, and many investors will want to identify with whoever is responsible for the economy.
At the same time, businesses will want a situation where there is a clear understanding of the impact of Covid-19 on their balance sheets and the interventions needed to correct them at the economy level. Ken’s experience as an investment banker and entrepreneur matches this.
So what are Ken Ofori-Atta’s legacies over the past 4 years? Ken has led the Department of Finance with unprecedented energy over the past 4 years. Under his leadership, the ministry led various policy reforms and initiatives aimed at ensuring effective management of economic policies with a view to achieving macroeconomic stability and sustainable economic growth.
His understanding of the economy and its prudent management led him to work with President Akufo-Addo and his government colleagues to achieve an average decline in Ghana’s budget deficit from 6.5% of GDP in 2016 to 4 , 8% in 2017, 3.9% in 2018 and 4.8% in 2019.
While the budget deficit narrowed on average, overall real GDP growth rebounded from 3.4% in 2016 to 8.1% in 2017, then moderated to 6.3% in 2018, then to 6.0%. 5% in 2019. The forecast real GDP growth for 2020 has been revised significantly down from 6.8% to 0.9% reflecting the impact of COVID-19 on economic activities.
Provisional third-quarter GDP data released by the ESG shows that overall GDP, after increasing 4.9% in the first quarter, contracted by 3.2% and 1.1% respectively in the second and last quarter. third quarter of 2020, with an average of 0.2%.
It is important to note that there were many real sector initiatives undertaken in the ministry during Ken’s 4-year management period, including the repayment of accumulated arrears from contractors and debts inherited from the energy sector, spending over GHS 21 billion for cleaning up the financial sector to protect savings and investments. more than 4.6 million Ghanaians and businesses.
He is also known for helping local banks stay in business through the establishment of the Ghana Amalgamated Trust (GAT), the development of the Capital Market Master Plan (CMMP), the establishment of the Ghana Commodity Exchange (GCX) , supporting the redevelopment of the mortgage sector and the availability of cheaper loans to local developers through the National Housing and Mortgage Fund (NHMF), facilitating Ghana’s membership in the African Agency for insurance (ATI) and leading efforts to develop an economic policy plan for Ghana’s response to the COVID-19 crisis – the Ghana CARES program (Obaatan Pa).
Ken is the premier finance minister to establish a formal relationship with faith-based institutions, unions and employers’ association by establishing the Social Partnership Council for Industrial Harmony, Policy Transparency and taking advice from these stakeholders essential.
Ken’s success can also be summed up over the past 4 years with accolades such as the World Bank named him “African Minister of Finance of the Year” for 2018, successfully chairing the Joint World Bank Development Committee- IMF and Board of Directors of Africa Capacity Building Foundation (ACBF).
With the above experience, Hon. Ken Ofori-Atta has the knowledge, skills, attitude and mindset to continue in his public service role as Minister of Finance. This will also give it the opportunity to carry out the flagship programs underway for economic and social development.
As a country, we must seize the moment and ensure that we continue to use our best talents to support our economic growth and development at all times.
The author, Yaw K. Dei is a columnist.
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