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20.11.2003 Business & Finance

House approves 48 million dollar ADF loan

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Accra, Nov. 20, GNA - With a vote of 122, Parliament on Thursday unanimously approved a 48,757,800 dollars budgetary support loan agreement between the Government and the African Development Fund (ADF) for the Poverty Reduction Support Programme (PRSP).

This was after the House adopted the Parliamentary Finance Committee's Report on the agreement following a motion by Mr Eugene Atta Agyepong, Chairman of the Committee and seconded by the Minister of Finance and Economic Planning, Mr Yaw Osafo-Maafo.

In seconding the motion, Mr Osafo-Maafo noted that the loan was for budgetary support, given by the ADF, one of Ghana's major development partners, specifically for the PRSP, adding that, "this is not part of the HIPC (Highly Indebted Poor Countries) relief".

He urged that House to approve of the loan, saying that it had a repayment period of 40 years, an additional grace period of 10 years, an interest rate of one per cent within the first 11 to 20 years and three per cent for the rest of the repayment period.

Mr Modestos Ahiable, NDC-Ketu North supported the motion and urged the Government to ensure that the money was disbursed according to law.

He said; "we need to look at the disbursement process critically to ensure that the money is fairly disbursed to benefit most needy areas of the economy".

Mr Abuga Pele, NDC- Chiana-Paga, stressed the point on fair disbursement of the loan saying that most of the high poverty stricken areas of the country were often neglected in the disbursement of loans and HIPC funds.

"We must take a critical look at the criteria by which we disburse PRS funds in this country, with the view to addressing the imbalance in the economy. We must clearly define the bureaucratic criteria we use in disbursing funds in this country," he said.

He said it was not enough to say a specific sum was put in such areas as capacity building, good governance, public sector and other things, adding, "we need to be told for example which institutions of good governance benefited from such funds".

Mr Osafo-Maafo corrected the assertion that high poverty stricken areas were neglected in the disbursement of PRS Funds saying that the criteria used in disbursement were carefully designed to ensure that in taking care of the high poverty stricken areas, the non-poor areas were not neglected to become poor.

"Our plan is to reduce poverty holistically - we employ such managerial skill in dealing with the high stricken poverty areas along side the non-poor areas which have the tendency of becoming poor if neglected."

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