A senior lecturer at the Department of Economics at the University of Ghana has urged managers of Ghana’s economy to consider returning to the International Monetary Fund (IMF) for critical support in the wake of Ghana’s falling credit rating.
Dr Adu Owusu Sarkodie said on Monday, January 17, 2022 that returning to the IMF will improve the falling credibility of Ghana’s economic policies.
“My…most bitter option is to seek an International Monetary Fund programme. This is not something I want. I have never wanted an IMF programme for this country. In all my submissions, I haven’t been impressed with Ghana going to the IMF.
“But any time we have gone to the IMF, there was the need for it. We mess up and we get ourselves into the situation where there is no way out except to seek an IMF programme,” he told Asaase Radio when he listed a raft of options available to redeem itself from the current economic challenges.
Dr Sarkodie also mentioned that the decision to return to the IMF will depend, among other things, on the government’s ability or otherwise to borrow from multilateral institutions, pass the E-Levy Bill and reverse the new benchmark value and road toll policies.
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His comments follow Fitch’s downgrade of Ghana’s long-term foreign-currency issuer default rating (IDR) from B to B- with a negative outlook.
The government, meanwhile, has said recently that the economy is not challenged, parrying away a gloomy picture painted about Ghana’s economy by a Bloomberg article.
The Ministry of Finance has said a recent publication by Bloomberg suggesting that the Ghana economy is in a dire state because of debts contains factual inaccuracies.
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A statement by the Public Relations Unit of the Ministry in response to the Bloomberg article, rubbished all claims while insisting that the Ghanaian economy is still robust as seen in its rapid rebound post-COVID-19, showing a healthy Gross Domestic Product (GDP) of 6.6 per cent for the third quarter alone and an average of 5.2 per cent for the first three quarters of 2021.
The Ministry noted that while the end year growth targets for 2021 has been revised to 4.4 per cent, “the high-frequency indicators suggested a continued strong momentum in economic activities.”
On the country’s debt, the ministry noted that the country’s economy remained strong.