This week, an assessment team from the International Monetary Fund (IMF) will arrive in Accra to start analyzing Ghana’s macroeconomic statistics in order to provide a suitable program for the nation.
As a result of the worldwide economic collapse brought on by the COVID-19 pandemic and the Russia-Ukraine war, the government announced on Friday, July 1, 2022, that it had chosen to work with the Fund to provide balance of payment support.
These crises have reduced the nation’s foreign reserves and buffers and resulted in significant inflation, fuel price increases, and local currency depreciation.
On a television station on Sunday night, Mr. Oppong Nkrumah discussed the cost of living crisis and the government’s decision to work with the IMF. He said the decision was made to increase Ghana’s foreign reserves, obtain liquidity to meet the obligations associated with servicing external debt, and provide balance of payment support.
He stated that President Nana Addo Dankwa Akufo-Addo would serve as the Taskforce’s chair during negotiations with the Fund and that it intended to collect roughly two billion dollars from the Fund to bolster reserves and create buffers to lessen Ghanaians’ hardship.
According to Mr. Oppong Nkrumah, the country may access $1 billion from the global finance market, but doing so would need legislative approval.
The Minister stated that relying solely on IMF assistance would not be adequate to address the current economic issues and that industry needed to raise production in order to cut back on imports.
“There is no magic solution to solve the economic problems.
“The impact of the global crises is so severe that some of the domestic measures introduced by the government though had worked, were unable to stop the impact on Ghanaians,” Mr Oppong Nkrumah noted.
He acknowledged that the government’s decision to request assistance from the IMF had not been an easy one, but government had taken that courageous step for the economy to quickly recover from the global economic difficulties in the best interest of the public, saying: “Tough times call for tough decisions.”
When asked if the National Democratic Congress (NDC) government’s decision to request a bailout from the IMF in 2015 had been justified, Mr. Oppong Nkrumah responded that the circumstances at the time were different and explained that: “They (NDC) said the meat had been chewed and left with the bones but Moody’s assessment of the Ghanaian economy at the time noted mismanagement of the economy.”
” Our situation is completely different because we’re in global crises and Ghana is not an exception. We need to deal with the crises holistically and so we need to engage industries to grow and produce more and take pragmatic steps to mobilise sufficient resources from the Property Rate and other domestic resources and plug the loopholes in the e-levy transaction,” Mr Oppong Nkrumah stated.