We must strengthen our financial institutions to fund infrastructure development – Seth Terkper

Former Finance Minister and Economic Adviser to the President, Seth Terkper, has emphasized the need for robust development finance institutions to bolster Ghana's infrastructure development and overall economic transformation. While addressing the inauguration of Global Leadership, Innovation and Development Academy (GLIDA) in Accra on October 16, Terkper advocated for the enhancement of existing institutions alongside the creation of efficient borrowing and debt repayment frameworks to fund development initiatives.

He highlighted the National Investment Bank (NIB) as a prime example, noting its establishment predates that of the China Development Bank, underscoring Ghana's early strides in establishing such institutions. "Our National Investment Bank is older than the China Development Bank," Terkper pointed out, stressing the importance of maintaining and strengthening these entities.

Citing the China Development Bank's contributions to infrastructure projects as a benchmark, Terkper argued that bolstering such financial bodies is crucial in the wake of Ghana's attainment of middle-income status. This status has altered the country's access to external financial aid, necessitating a shift towards bolstering domestic funding sources and exploring alternative financing methods for capital expenditures.

"We had to strengthen our domestic markets to finance our capital budget in particular," Terkper elaborated. He also cautioned about the pitfalls many developing nations face when entering international sovereign bond markets without proper preparation, highlighting the need for sound borrowing practices supported by clear repayment strategies.

Terkper urged Ghana to prepare its financial institutions for the challenges of further economic growth, including the potential rise to upper-middle-income status. He urged the nation to learn from successful economies and forge partnerships that would help leverage its middle-income status to drive substantive development.