Economist and Energy Expert Dr. Theophilus Acheampong has asserted that the reasons for which the erstwhile National Democratic Congress (NDC) Government went for a program with the International Monetary Fund (IMF) are similar to those for which the current New Patriotic Party (NPP) administration is seeking a program.
Dr Acheampong noted that the issue of the economy which has necessitated IMF bailouts is structural and COVID-19 and the Russia-Ukraine merely exposed the weaknesses of the economy and if the economy were strong enough, it would have withstood the impact.
Communicators of the governing New Patriotic Party (NPP) have insisted that the impact of COVID-19 and the Russia-Ukraine war are to blame for Ghana’s decision to seek an IMF bailout. But Dr. Acheampong says it is annoying to cite those as reasons for the bailout.
“One thing that irks me: is that the NDC’s IMF program is different from the NPP’s potential IMF program. This Russian-Ukraine war and COVID excuse as the leading cause is over-flogged. Dealing with external shocks is part of managing an economy.
Both events have affected all countries globally, some of whom have been able to withstand them better than others. I’ve always said that COVID and the Russia-Ukraine war only exposed the soft underbelly of the Ghanaian economy: excessive liberalization, debt binging, and not having built enough fiscal buffers. That is the real issue we should be debating!
So, whether NDC IMF ooo or NPP IMF ooo, the value is pretty similar in terms of the intent: you have a pending balance of payments issue (FX crisis), the causes of which are very structural. Both of these two parties have indicated and went to the IMF, albeit the latter is now at early-stage negotiations. Let’s stop the propaganda and get real on solving the problems, ” he explained.
The NDC Government 2014 sought an IMF program after the Cedis lost nearly 40% of its value. The Government at the time explained that it was for policy credibility.
Currently, the NPP Government wants an IMF program to help it deal with the balance of payment challenges.