WHY IT MUST BE THE LAST IMF PROGRAMME

ANYBODY with brains must understand why President John Mahama, would declare that the International Monetary Fund (IMF) Programme is the last one for the country.

Understandably, the government decided to go for an IMF bailout programme aimed at overcoming the country’s economic challenges, particularly economic growth and inflation.

The situation at the time (2015) required a pragmatic approach and the government decided to turn to the IMF, which granted $940million to assist Ghana to turn the ailing economy around.

According to the IMF, it granted the $940 million on condition that government would restrain and prioritise public sector spending, increase tax collection and strengthen the effectiveness of Bank of Ghana’s monetary policy role.

At the time Ghana turned to the IMF, the country was, no doubt experiencing declining economic growth, high inflation, high interest rates, depreciating currency and energy crisis.

However, before the IMF approved the IMF, a section of the public criticised the decision, warning government against going to the IMF because of the austere conditions attached to the bailout.

The argument is made that no IMF bailout has worked in the interest of the people. In infact, many people pointed to other IMF programmes elsewhere that had not brought the desired results to the people.

It is, therefore, not surprising that the President would make such emphatic pronouncement about the IMF programme.

Without exception every government as far back as the beginning of the republic has turned to the IMF/World Bank for one support or another.

In all of them, ordinary people bore the brunt of the harsh economic conditions.

It is, therefore, gratifying that President Mahama, has assured that next year would be the last year of the IMF programme and no more.

“Next year is the last year of the IMF programme, and then we will go back to the home grown fiscal policy. We are almost there, and we will finish hard. And I am reiterating that this IMF programme is to end all IMF programmes,” he was quoted as saying when he addressed the 10th Quadrennial Delegates Congress of the Trades Union Congress (TUC), in Kumasi on Wednesday.

The President who was responding to the demand of the Trades Unions on the government to withdraw from the programme, sounded candid in his response, and we want to believe that the economy is responding well to make him promise to end the programme next year.

We support the position and hope that government would work hard to ensure that the economy would not decline again to the level it did before the IMF bailout.

 

 

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