BoG Clarifies ₵22B Printed Notes Allegation

Hajara FuseiniJuly 27, 2022

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The Bank of Ghana (BoG) has indicated that the amount of GHC22.04 billion captured under BoG as financing in the 2022 Mid-Year budget does not refer to printed cedi notes.

The Central bank notes that the amount represents net claims on the Government, and not new currency printed to support the Government’s budget.

The BoG said the net claims comprise GHC 1.6 billion government of Ghana Stocks and bonds sold by commercial banks to Bank of Ghana under repurchase agreements, by which banks routinely manage their liquidity positions; GHC6.2 billion IMF SDR allocation disbursed to Government through Bank of Ghana; GHC 2.85 billion draw-down of Government’s own deposits held with Bank of Ghana, and GHC 11.4 billion overdrawn balance on the Government’s treasury main account held with Bank of Ghana.

The BoG on that note assured the public of its commitment to comply “fully” with all relevant legal requirements under the guidance of the Bank of Ghana Act, 2002 (Act 612) as amended.

“Should the need arise for emergency financing by Bank of Ghana in line with the BoG Act, Bank of Ghana, as was done in the case of the Covid-19 Bond of 2020, will follow the processes prescribed by the Act.”

Background

After Finance Minister Ken Ofori Atta presented the Mid-Year Budget Review in Parliament on July 25, 2022, the Ranking Member on Parliament’s Finance Committee, Cassiel Ato Forson, alleged that the Bank of Ghana had printed 22 billion cedi notes without Parliament’s approval.

He referenced Appendix 2A of the Mid-Year Fiscal Policy Review document in making the allegation.

“When the minister spoke in his statement, he failed to inform all of us that something significant has happened at the Bank of Ghana. Between January 2022 and June 2022, the Minister responsible for Finance and the government have gone to the Bank of Ghana and have encouraged the Bank of Ghana to print money worth GHc22 billion…without the knowledge of Parliament”, he told the press in Parliament.

Ato Cassiel who was deputy Finance Minister during the erstwhile Mahama administration added that the printed notes are responsible for the country’s galloping Inflation and dwindling international reserve.