‘IMF bailout short of debt restructuring not sustainable’

A Policy Analyst, from Integrated Social Development Centre (ISODEC), Mr Bernard Anaba, has said any International Monetary Fund (IMF) bailout short of debt restructuring would only be a debt-pile on debt and could not be sustainable.

According to him the global financial system was not serving poor countries adequately, given the enormous capacity of available resources to deal with poor countries’ problems.

He said this in Accra yesterday, at the African Inclusive Economic Recovery Project, on the theme “The Role of the Media securing an Inclusive Economic Recovery and Debt Relief.”

The Workshop, orgnaised by Caritas Ghana on Special Drawing Rights (SDRs) allocations and economic recovery, debt burden and evidence was to push government accountability.

The objective of the workshop was to schooled journalists, harness a common front to demand accountability, transparency, and good governance around the use of public resources, secure an inclusive economic recovery, and monitor SDRs Allocation.

MrAnaba said SDR was an international reserve asset, created by the IMF to supplement its member countries’ official reserves.

He said SDRs by their size and multi-lateral nature, could be a more sustainable and concessionary source of funding to help poor countries’ development needs.

“The IMF creates the SDRs for its member countries and plays a role as the “lender of last resort” for an economy experiencing debt-servicing difficulties,” he said.

He said the IMF’s resources were limited, but could create more resources by levying global financial resources, “It is estimated that the IMF could make about $30 billion a year by levying financial transactions.”

Mr Anaba appealed to Civil Society Organisations (CSOs) to unite on the call for debt restructuring and cancellation.

He said this would be the means of co-responsibility from the government, the IMF and the lenders in order to lessen the pain of austerity on citizens.

“We must actually use this IMF bailout to force accountability and responsible use of public funds going forward,” he said.

Mr Anaba said the long-term solution to the country’s economic crisis should begin from solving the internal mismanagement and corrupt practices of successive governments through greater accountability and external forces.

“Debt crises as seen in poor countries is not only caused by internal malaise as in corruption and poor economic management but also some external forces including actions of rich countries-therefore requires global actions,” he said.

Mr Anaba called on the IMF to link its funding allocations to domestic accountability and transparency processes.

This, he said would provide for CSOs Peer Review of government reports before funding is allocated.

“The IMF must be candid in its sustainability assessment of Ghana to avoid misdiagnosis of Ghana’s economic challenges,” he said.

The Acting  National Director of Caritas Ghana, Mr Thomas Awiapo said his outfit would continue to call for clear and transparent practices that enable citizens and civil society organizations to openly follow how SDRs had been utilized to avoid misappropriation and also ensure the social sectors of the economy receive a fair share.

A media practitioner, Mr Iddi Yire said despite the current economic hardship facing Ghana, the media must project the nation’s image positively.

He, however, advised the media to influence the nation’s financial crisis by provoking and sustaining a long-term economic recovery agenda.

Caritas Ghana is a charity organization of the Ghana Catholic Bishops’ Conference (GCBC) and operates under the National Catholic Secretariat.


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