Alex Mould,a former Chief Executive Officer of the Ghana National Petroleum Commission (GNPC), has urged the government to go to the International Monetary Fund (IMF) early in order to recover over time.
“We have to go to the IMF, so that the earlier the better we recover over time and we also need to cut down on our expenditure, get our credit lines open and manage our local interest rate.
“Obviously, we need new money and right now, without credibility, no one is going to listen to us, it is not that someone wants us to go to the IMF because that is the institution that gives us the credit derivative,” Mr Mould said.
His advice comes at the time when international rating agencies have downgraded Ghana’s credit rating however, the government has rejected Moody’s downgrade of Ghana’s credit rating and the Ministry of Finance in a statement stated it was puzzled by Moody’s rating of the country.
Touching on the fresh calls for Ghana to seek support and assistance from the IMF, Mr Mould maintained that the timing would only be right “if the government fast tracks processes to seek such assistance to stabilise the economy”.
He implored the government, to as part of its austerity measures, reduce public expenditure in the face of the country’s economic challenges and calls for the government to return to the IMF must be heeded without further delays to salvage the economy.
According to him, the government must manage expenditure because it was within direct control and needed credit line since credibility was very low and added that “the only way we can bring the credibility up is to go to a very credit worthy institution to hold our hands to our various creditors”.
Fitch, in January 2022 downgraded Ghana’s economy from B to B- with a negative outlook and Moody’s also downgraded Ghana’s economy from B3 with a negative outlook to Caa1 with a stable outlook and the new ratings reflects Ghana’s challenges in fixing liquidity and debt challenges.
With limited access to the international financial market, Ghana, for instance, is turning to domestic revenue mobilisation to rescue the situation while some analysts have proposed seeking an IMF bailout as better alternative. –citinewsroom.com
