An outspoken member of the governing New Patriotic Party (NPP), Patrick Kwarteng Sarpong, commonly known as P.K. Sarpong, has criticized Dr. Randy Abbey, the host of Good Morning Ghana on Metro TV, for his response to the Danquah Institute’s debt analysis.
Sarpong described Abbey’s outbursts as stemming from ignorance and an empty display of sentiments. Abbey had reacted to the policy think tank’s analysis of Ghana’s debt accumulated between 2009 and 2023.
Randy Abbey said, “Danquah Institute, NPP has managed Ghana’s debts better. You guys just can’t help getting people upset and angry every day. And I read the analysis. I couldn’t just believe the level of intellectual dishonesty in this analysis that has been made. Even in the face of DDEP (Domestic Debt Exchange Programme), you have the nerves to speak like this.”
In a letter addressed to Randy Abbey, P.K. Sarpong clarified that the Danquah Institute’s analysis, presented during its engagement with the media, focused on Ghana’s debts accumulated between 2009 and 2023, highlighting which political party effectively utilized the loans contracted.
Sarpong emphasized that the Danquah Institute based its analysis on data obtained from credible sources such as the Bank of Ghana, the Ministry of Finance, and international bodies like the World Bank and the IMF.
He reiterated that the Danquah Institute, like other think tanks, comprises well-educated individuals and has the right to freedom of speech, choosing to express its views on matters of national significance.
“Lack of respect and appreciation of data from you, Randy Abbey, a supposed colleague is quite perplexing. You should question with data and not sentiments laced with attacks with the view to gagging the institute,” portions of the letter read.
P.K. Sarpong told Abbey in the letter that “retorts like those from you just expose the biased opinion you now profess. You simply betrayed your ignorance for someone who professes to hold a Ph.D.”
He stated that, contrary to Abbey’s ignorance and that of his colleagues in the NDC, the Danquah Institute’s analysis was based on facts and data. Sarpong highlighted that if intellectual dishonesty were a person, then Randy Abbey would epitomize it.
“Ghana’s economy, just like many others across the globe, was plunged into an economic depression due mainly to COVID-19 and the raging war in Ukraine, between 2020 and 2022. The onset of the Covid-19 pandemic precipitated the shutdown of economies, disrupted revenue streams, and exacerbated public debt burdens via high shipping costs, an increase in crude oil prices, amongst others,” he stated in the letter.
To demonstrate the impact of high shipping costs during the pandemic, he analyzed the Freightos Baltic Index (FBI) Global Container Freight Index, which measures shipping costs on major routes worldwide.
Comparing data from February 2020 to September 2021, he highlighted a significant surge in the index, increasing by eightfold. In February 2020, shipping costs per container were approximately $1300.
However, by September 2021, this figure had skyrocketed to a peak of around $11,000.
“Increases in shipping cost had widespread implications on consumer prices, primarily by impacting import prices directly. This is because the local prices of imported goods tend to rise proportionately with the increasing shipping costs. Inflation skyrocketed as a result of these factors,” he stated.
“In this respect, since the reserves we had as a country were not able to meet the demand, it automatically made the Dollar quite expensive to acquire, driving it upwards as the local currency tumbled. This is basic and a whole Ph.D. holder fails to grasp? Strange!,” he indicated.
He explained that the Danquah Institute’s use of the US Dollar in its analysis, instead of the Ghana Cedi, was deliberate. This choice was based on the US dollar’s status as the world’s primary reserve currency and its widespread use in international trade. He further noted that the US dollar is recognized for its stability, maintaining its unit of account and purchasing power consistently over extended periods.
“Another important takeaway from Danquah Institute’s analysis is that foreign currency debt carries an exchange rate risk. This implies that the debt stock in local currency terms could even rise with no new borrowings,” he mentioned.
He pointed out that, for instance, the public debt of $29.2 billion in 2016 would now be equivalent to about GHc380 billion without any additional borrowing.
Therefore, he argued that suggesting the current government had borrowed more than any other administration and had increased the debt from around GHS140 billion to about GHC610 billion is disingenuous.
He reiterated that Akufo-Addo had borrowed almost the same amount of money as Mahama but had achieved more with his borrowing than his predecessor.
He said, “The reasons for the rise in the debt levels have been explained vividly. Update yourself on these facts and stop your emotional outbursts and attacks on Danquah Institute. DI spoke with facts. Bring your facts and let us compare them. The truth is that there are no other facts to these issues apart from what DI employed in its analysis”.
He also outlined information on the strength of the Cedi as against the US Dollar and the percentage increases between the two main political parties.
“This data is from the Bank of Ghana. Interbank Exchange: BoG, 2008 – 1.2, 2016 – 4.2, 2017 – 4.4, 2018 – 4.8, 2019 – 5.5, 2020 – 5.7, 2021 – 6, 2022 – 8.5, 2023 – 11.8, 2024 – 12.74 (March),” he pointed out.
“Your NDC took the Ghanaian Cedi from 1.2 to the dollar. At the time Mahama was leaving office, it was 4.2. In nominal terms, this translates into about a 250% increase.
“Akufo-Addo took it from 4.2 to 12.7, translating to about 202%. This simply means that in the management of the local currency as against the US Dollar, the NPP administration has done far better than the NDC despite the unprecedented challenges the economy has faced as a result of extraneous factors (COVID-19 and Russia/Ukraine conflict),” he added in the letter.
K.P Sarpong further emphasized that the NDC never faced a quarter of the challenges the Akufo-Addo/Bawumia administration had encountered, yet the currency had been managed better by this administration than Mahama did.
“If honesty was a trait you hold dear, you’d come to appreciate and admit to the fact that the data supplied by Danquah Institute cannot be controverted. Your people failed Ghana even when the global economic conditions were favourable,” he stressed.
On her part, the Executive Director of the Danquah Institute (DI), Dr. Antoinette Tsiboe-Darko, criticized Randy Abbey’s critique, describing it as emotionally driven and lacking a clear understanding of the facts and figures presented by the Institute.
She emphasized that the DI’s analysis was based solely on an examination of the country’s debt situation. Dr. Tsiboe-Darko urged Abbey to conduct thorough research before making judgments.
She reiterated that the Danquah Institute remains steadfast in its conviction that a thorough examination and discussion of facts, supported by rigorous research and data, are essential in providing the citizens of Ghana with enhanced clarity, information, and context regarding pertinent national issues.
Dr. Tsiboe-Darko added that through DI’s commitment to evidence-based discourse, it aims to foster a more informed and enlightened public discourse that promotes transparency, accountability, and progress in Ghana’s socio-political landscape.
