The Bank of Ghana (BoG) has released the first tranche of GH¢5.5 billion of the GH¢10 billion emergency facility the government is seeking to support residual expenditures to cushion the economy against the impact of COVID-19, the Minister of Finance, Mr Ken Ofori-Atta, has said.
The release, he said, was consistent with global policy responses of central banks with large-scale asset purchases to provide support to manage the pandemic.
However, the Minority in Parliament described the move as an illegality and vowed to go all out to resist it.
Exceptional circumstances
Addressing Parliament yesterday, the Finance Minister said: ”Given the exceptional circumstances and the challenges posed by COVID-19, the Finance Minister, the Governor of the Bank of Ghana and the Controller and Accountant-General, as required under Section 30 of the BoG Act, 2002 (Act 612) as amended, have agreed to trigger the emergency financing provisions under the law, which permitted increasing the limit on the purchase of government securities by the BoG in the event of any emergency to help finance the residual expenditures,” he said.
He added: “The government, therefore, decided to launch a special COVID-19 Relief Bond Programme with a size of GH¢10 billion.
“The coupon rate is pegged to the prevailing monetary policy rate with a 10-year tenure and two-year moratorium on both principal and interest payments.”
He stated this when he laid the Parliamentary memorandum on the report on the limit of borrowing of the government under sub-section (6) of section 30 of the Bank of Ghana Act, 2002 (Act 612) in the novel coronavirus emergency.
Graphic