Experts at war over 'sense' in investment of heritage funds

The ministry of finance has come under heavy criticism in relation to the Stabilisation and heritage Funds. Monies accrued from investment of these monies have not satisfied many financial analysts and economists as the two funds accrued $448 million after they were invested in foreign portfolios at a rate of 2% and 2.5% respectively.

According to the Bank of Ghana's mid-annual report for 2015, the Stabilisation Fund accrued a total of $250 million and the heritage funds a total of $233 million

Chairman of the parliamentary select committee on finance, James Klutse Avedzi has been addressing these concerns saying, the committee in charge of advising the ministry of finance on investing these monies assessed all available options in accordance with the dictates of the legislation governing the use of the country's petroleum funds and took the right decision as to the best way to invest it.

" The funds are for specific purposes. The stabilisation fund is intended for economic shocks and generation shortfalls. The law has clearly spelt out how it should be invested, and I am sure the ministry of finance is taking the right decisions possible in accordance with the law on how to invest these monies."

Meanwhile,the head of Banking and Finance Department at the University of Ghana Business School, Dr. Godfred Bokpin says the country could find a better investment portfolio for the stabilisation fund locally, that could accrue better yields for the country.

" The monies being accrued from investing the stabilisation fund are woefully woefully inadequate. Surely, we can find better ways of investing that money in a way that will strengthen our economy."

Speaking exclusively to , the banking expert recommended that the heritage fund, which essentially is the stake of future generations in Ghana's current oil resources, can be used to the benefit of the country, whiles satisfying its original intent.

" I suggest that we lend the heritage funds to the current generation, which will be strictly used to undertake economically viable projects. Here, all profits accruing from the project will then be kept in the heritage fund. That way the current economy will benefit from these funds as well."

Per the dictates of the legislation governing the use of Ghana's petroleum funds, a heritage fund is supposed to be set aside for the future generation, which is not to be spent. Many have, over the years, questioned the rational of this fund, when Ghanaians are currently facing considerable amounts of hardship due to current shortfalls in revenue generation. Arguments have been made in support of using these funds for economic ventures for the benefit of the current generation.