Cabinet didn’t support HIPC initially – Kufuor
Former President John Agyekum Kufuor has said that the decision of his government to declare Ghana an insolvent state, thus a Highly Indebted Poor Country (HIPC) was due to the firm assurance of debt cancellation he received from two female British politicians, Baroness Valerie Amos and Clare Short.
According to former President Kufuor, “not even my cabinet readily accepted the decision for me to declare Ghana as a HIPC nation because they said it was too demeaning for a young government, which took office in 2001, to go to the public and admit the insolvency of our country”.
“But why I dared to stand firm and to virtually force my cabinet to agree with me to go to parliament to tell the nation that the government was taking the initiative, I will confess here that it was chiefly due to the assurance I got from Baroness Valerie Amos and Clare Short that if Ghana will take that step they will ensure that the government of Britain will rally to the support of Ghana,” he said.
Mr Kufuor made this known when he was addressing a Grand Durbar of Chiefs and people of Larteh Akwapim in honour of Baroness Valerie Amos, Director of the School of Oriental and African Studies (SOAS), University of London. The event also marked the launch of the SOAS, University of London and MountCrest University College Transnational Education Partnership Programme.
I felt forced to declare HIPC
At the time he took office in 2001, President Kufuor said “we just couldn’t bear the burden of our debts internationally, but cabinet didn’t support it and not any of our best known economists would support it, but I found that there wasn’t any alternative to admitting to the situation that we were, in a way insolvent, economically.
“I met a number of international experts; for instance, the president of the World Bank at the time and two ladies, Clare Short and Baroness Valerie Amos”.
“Talking with these important people about our economy, in a way I felt forced to admit the dire situation of our economy and once you admitted, you were forced to logically say that taking the initiative was the only alternative thing to do.”
£50 million indebtedness
He said in 2001 alone, Ghana needed an amount of £50 million to pay interest on loan indebtedness to Britain.“Where were we going to get the money from?” he asked.
He said there were other interests to pay for other creditors but for that of Britain alone, Ghana needed to find £50 million “to service our indebtedness, so when I met the ladies and they assured me that if we will take this (HIPC) initiative, Britain will come to the support of Ghana to change the situation, to lighten the burden on us, I came back to meet my cabinet, and with this secret up my sleeves, I dared the economists who were resisting the idea that if you wouldn’t go HIPC, give me an alternative and, of course, they didn’t have any alternatives, so I instructed the Finance Minister then, to please go to Parliament and tell the nation that the President has decided to take the HIPC initiative, which we did.”
Cancellation of £50 million loan debt
The former President said, “Soon after we came out like that, Britain virtually cancelled the £50 million debt we owed and it was the first country to do so and that opened the gate for “our economic recovery and improvement that I have come to be associated with.”
In his bid to show appreciation to Baroness Amos, former President Kufuor said he and his government conferred on her the Order of the Volta.