A Banking Consultant, Dr Richmond Atuahene, has indicated that many banks in the country could soon find themselves in serious trouble if the government continues to borrow from the domestic market without thinking.
Dr Atuahene said the domestic debt exchange programme (DDEP) gave the government the chance to borrow more from the domestic market. He said the government has used that advantage to borrow without thinking about the future of the banks.
“Ever since we went through the domestic debt exchange programme, the government has borrowed as if it is nobody’s business,” he stated.
According to him, the Banking Consultant, the government borrows to pay its debts that are due, a practice he says is a major stress on the banks and must be stopped.
“They use the short-term to finance the long-term as if nothing is going to happen. The way we are going, if we continue the trajectory that we are taking, the banks are going to be in trouble because the government is out of the financial market. It is not paying its outstanding debts,” he observed.
Also, Dr Atuahene shot down the government’s continuous self-praising that the economy is growing and performing. He said a performing economy should be seen in the private sector, adding that the public sector does not determine growth.
“When I hear them say the economy is growing, from the figures available, I don’t see the growth anywhere because it is the private sector that grows the economy and not the government sector but unfortunately, the private sector is deprived of capital and cannot expand business,” Atuahene said on the Citi Breakfast Show on May 22.