{"id":8607,"date":"2014-03-25T18:00:05","date_gmt":"2014-03-25T18:00:05","guid":{"rendered":"http:\/\/4cd.e16.myftpupload.com\/?p=8607"},"modified":"2014-03-25T18:36:52","modified_gmt":"2014-03-25T18:36:52","slug":"excessive-bowing-endangering-ghanas-oil-discovery-bawumia","status":"publish","type":"post","link":"https:\/\/citifmonline.com\/2014\/03\/excessive-bowing-endangering-ghanas-oil-discovery-bawumia\/","title":{"rendered":"Excessive borrowing destroying benefits of oil discovery \u2013 Bawumia"},"content":{"rendered":"
\"Dr.<\/a>
Dr. Bawumia<\/span><\/figcaption><\/figure>\n

The 2012 vice presidential candidate of the New Patriotic Party (NPP), Dr. Mahamudu Bawumia has stated that Ghana\u2019s excessive borrowing has put the country\u2019s oil discovery in danger.<\/p>\n

\u201cOver the last five years, the accelerated borrowing, the massive increase in debt has basically compromised Ghana\u2019s oil discovery and the benefits that we could have gotten from it,\u201d he said.<\/p>\n

Addressing a public lecture on \u201cRestoring the Value of the Cedi\u201d at the Central University College in Accra, Dr. Bawumia<\/span> stated that the servicing of Ghana\u2019s accumulated debts \u201cis absorbing 36.3% of total government revenue.\u201d<\/p>\n

According to him, the declining growth and an increase in the payment of interests has taken up \u201ccritical fiscal space or cushion that previously existed. We are really in a very tight corner.\u201d<\/p>\n

Ghana started producing crude oil in commercial quantities on the Jubilee oil field in 2011 and currently produces about 102,503 barrels of oil per day(<\/span>bopd) for the first three quarters of 2013.<\/p>\n

Ghana earns five percent of royalties, a carried interest of 10 percent, an additional or paying interest of 3.75 percent and, petroleum income tax of 35 percent, while additional oil entitlement and also comes to the government, with the law allowing the International Oil Companies (IOCs) full cost recovery.<\/p>\n

According to him, government \u201cappears to have over-estimated Ghana\u2019s capacity to borrow by ignoring the fact that the re-basing of the economy statistically that took place did not increase while it increased our GDP. The numbers look good, but it did not increase the cash flows.\u201d<\/p>\n

Dr. Bawumia<\/span> likened the current economic situation being experienced in the country feels like \u201cwe are travelling in a bone shaker\u2026<\/span>if you are traveling on our roads and you are sitting on a seat that has no cushion, you will feel every pot-hole<\/span> in your bones.\u201d<\/p>\n

 <\/p>\n

By: Efua Idan Osam\/citifmonline.com\/Ghana
\nFollow @osamidan<\/a>
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