Democratic Forum, a research body, has written to the International Monetary Fund (IMF) to ask them not to grant the government of Ghana a loan facility.
They asked the IMF to instead provide technical support to the country to cause the government to be financially prudent.
Their letter signed by Executive Director Dr Frank Amoakohene stated that “The rising public debt: We believe that the government after borrowing Ghc 266. bn should have enough to develop Ghana, and the expected $3bn will not change much but only add to our public debt. That the IMF should focus on providing technical support to cause the government to properly account for the $2bn COVID support received from the IMF.
“That the IMF should cause the government to stop the profligacy, renting of private jets and payment of non-performing government officials. That less useful appointments such as the ambassador at large, and ambassador In-situ should be scraped and the staffers at the presidency should be reduced drastically.
“That the IMF should provide support for the fight against corruption since the country loses over $3bn yearly to corruption. We believe that these interventions would make enough funds available to solve the current economic crisis.”
Meanwhile, the IMF staff team led by Carlo Sdralevich visited Accra during July 6-13, 2022, to assess the current economic situation and discuss the broad lines of the government’s Enhanced Domestic Programme that could be supported by an IMF lending arrangement, which has concluded its meeting.
The IMF team met with Vice President Bawumia, Finance Minister Ofori-Atta, and Governor Addison of the Bank of Ghana. The team also met with the Parliament’s Finance Committee, civil society organizations, and development partners, including UNICEF and the World Bank to engage in social spending.
After the mission, Mr Sdralevich issued the following statement:
“Ghana is facing a challenging economic and social situation amid an increasingly difficult global environment. The fiscal and debt situation has severely worsened following the COVID-19 pandemic.
At the same time, investors’ concerns have triggered credit rating downgrades, capital outflows, loss of external market access, and rising domestic borrowing costs.
“In addition, the global economic shock caused by the war in Ukraine is hitting Ghana at a time when the country is still recovering from the Covid-19 pandemic shock and with limited room for manoeuvre. These adverse developments have contributed to slowing economic growth, accumulation of unpaid bills, a large exchange rate depreciation, and a surge in inflation.
“The IMF team held initial discussions on a comprehensive reform package to restore macroeconomic stability and anchor debt sustainability. The team made progress in assessing the economic situation and identifying policy priorities in the near term.
The discussions focused on sustainably improving fiscal balances while protecting the vulnerable and poor; ensuring the credibility of the monetary policy and exchange rate regimes; preserving financial sector stability, and designing reforms to enhance growth, create jobs, and strengthen governance.
“IMF staff will continue to monitor the economic and social situation closely and engage in the coming weeks with the authorities on the formulation of their Enhanced Domestic Program that could be supported by an IMF arrangement and with broad stakeholders’ consultation.
“We reaffirm our commitment to support Ghana at this difficult time, consistent with the IMF’s policies.
“Staff express their gratitude to the authorities, civil society, and development partners for their constructive engagement and support during the mission.”
