In Ghana, president appoints new prime minister
Nana Akufo-Addo, the president of Ghana, replaced his finance minister Ken Ofori-Atta amid ongoing economic tensions. Mohammed Amin Adam, who was previously the minister of state at the finance ministry, will succeed him.
Ghana faced its worst economic crisis in more than 20 years, with inflation rising above 50%. The International Monetary Fund responded by providing the nation with a $3 billion bailout that December. As the face of Ghana’s financial policy, Ofori-Atta has been under scrutiny for his performance as finance minister.
In an effort to mend the economy, Ofori-Atta negotiated an agreement to restructure $5.4 billion of external debt. The agreement, which the IMF commended last month, outlines a “domestic debt exchange scheme,” in which bondholders will swap their existing bonds for a set of new ones that will mature in a few years and the settlement of $13 billion worth of Eurobonds, international bonds in a foreign currency, owed to commercial creditors.
Members of Ofori-Atta’s party remain critical of his economic policy, which has led to the “constant rise of the cost of living and the devaluation of the currency,” according to Business Insider Africa.
The move to replace Ofori-Atta, who has served in the position since 2017, comes in anticipation of the Ghanaian presidential election at the end of this year. Analysts suggest the move is an attempt by the current president, Nana Addo Dankwa Akufo-Addo, to improve his cabinet’s financial reputation before citizens hit the polls in December.
The election is a race between current Vice President Mahamudu Bawumia — nominated on behalf of the incumbent New Patriotic Party — and former President John Mahama of the National Democratic Congress, who preceded Akufo-Addo. Bawumia hopes to distance himself from the administration’s economic reputation.
According to Bright Simmons, an analyst at Accra-based think tank IMANI Africa, replacing the current finance minister “will create a much-needed new narrative for (the Vice President’s) slow-building campaign,” resisting political pressure from critics.
In France, government cuts EV subsidies
The French government cut electric vehicle subsidies for higher-income consumers on Tuesday. The decision comes after the United Nations’ milestone climate agreement to limit fossil fuels, established at its annual climate change conference COP28 held in December 2023.
The new regulation cut EV subsidies by 20% — from 5,000 euros to 4,000 euros — for the top 50% of buyers. The government, however, retained a subsidy of 7,000 euros for lower-income consumers. Despite the government’s history of incentivizing clean vehicle use, it is also wary of surpassing its public spending budget.
This week, France also announced that it will suspend its EV lease program through the rest of the year, which provided people living on under 15,400 euros annually with the ability to lease an electric vehicle for 100 to 150 euros per month. The program, announced in October of last year, was in high demand, putting the government in a position to suspend it to amass enough eligible vehicles.
Despite a lack of financial backing, representatives from roughly 200 countries at COP28 agreed to increase renewable use and energy efficiency. Negotiators established plans “transitioning away” from fossil fuels, following research proving fossil fuels to be the top contributor of greenhouse gas emissions.
“Finance is where the whole energy transition plan will stand or fall,” Mohamed Adlow, director of energy and climate think-tank Power Shift Africa, said in a post on X, formerly Twitter. “This process might deliver an agreement to move away from fossil fuels, but it’s failing to deliver a plan to fund it.”
While strides are being taken to reduce vehicle emissions, the French EV subsidy and lease programs could prove to be an example of climate goals that are overpromised and underfunded.
In the Czech Republic, former prime minister acquitted
Prague’s High Court acquitted former prime minister Andrej Babis for the second time, relieving him of $2 million worth of fraud charges in European Union subsidies. Last January, Babis was initially cleared, and the court tried the case.
The case concerned subsidies granted to Babis’ business conglomerate, Agrofert Group, which operates in the agriculture, science and media industries, among others. The conglomerate owned the Stork’s Nest, a Czech farm, but transferred its ownership to Babis’ family members, making it eligible for EU agricultural subsidies. Agrofert later resumed possession of the farm.
The prosecution charged Babis with the misuse of $2 million in EU subsidies, which was intended to support smaller businesses. An indictment would have involved a suspended jail term and a fine, and would have likely damaged the political prospects of Babis’ party, Alliance for Alienated Citizens — currently the most popular political group in the nation.
The initial acquittal from last January came just days before Babis ran in the country’s presidential election. Despite the legal victory, he was defeated by Petr Pavel, a retired military general. Prague’s High Court canceled the decision in September, sending it back for a second review.
The prosecution can still appeal the verdict, despite Babis’ repeatedly claiming that the case is a “politically motivated criminal investigation.”
Contact Anna Baird-Hassell at [email protected].
