Nana Akufo-Addo: President Directs Finance Minister To Engage IMF For Economic Programme

Nana Akufo-Addo: President Directs Finance Minister To Engage IMF For Economic Programme

  • The government has given the strongest indication yet of seeking a bailout programme from the IMF
  • A statement from the Ministry of Information has disclosed that the president has directed his finance minister to begin engagements with the IMF
  • Ghana has for a long time been battling economic instability characterised by high inflation and dangerously high public debt

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President Nana Akufo-Addo has directed Finance Minister Ken Ofori-Atta to begin formal engagements with the International Monetary Fund (IMF) for an economic programme.

The global economic disruption triggered by the Russia-Ukraine war has worsened Ghana's macroeconomy. High public debt, rising inflation and depleting foreign reserves have destabilised the balance of payment. Economic hardship in Ghana has remained a topical national issue since the start of 2022.

Akufo-Addo Ken Ofori-Atta and Bawumia
L-R: Nana Akufo-Addo, Ken Ofori-Atta and Vice President Mahamudu Bawumia
Source: Getty Images has sighted a statement from the Information Ministry dated July 1, 2022 that discloses that the IMF boss, Kristalina Georgieva and President Akufo-Addo have already had a conversation about a possible bail-out programme.

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“The President of the Republic, Nana Addo-Dankwa Akufo-Addo, has authorised Finance Minister, Ken Ofori-Atta, to commence formal engagements with the International Monetary Fund (IMF), inviting the Fund to support an economic programme put together by the Government of Ghana,” the statement said.

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Just last month, the finance minister ruled out the possibility of seeking assistance from the IMF when he told reporters that Ghana was committed to managing its debt without assistance from the multi-lateral institution.

Ofori-Atta was making these confident statements when Ghana's total public debt figures were staggering.

The IMF disclosed in May that Ghana's total debt was estimated at 81.8% of GDP in 2021, higher than the 80.1%. Per the Bank of Ghana figures, public debt was around GH¢351.8 billion.

Banking his hopes on a controversial electronic transactions levy (E-Levy), the minister remained resolute that the country's debts, rising inflation and depleting reserves would see some respite.

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However, persons close to government disclosed that the unpopular tax had only delivered 10% of the estimated GHS600 million revenue to shore up the economy.

Government begins changing stance

Meanwhile in June, the government has revealed it is now considering the IMF.

After strongly ruling out a possible bailout to shore up Ghana’s dwindling finances, Deputy Minister of Finance Dr. John Kumah indicated government is considering IMF as Ghana's economic hardships bite.

He said the government will make the decision once it is convinced that it is absolutely important.

Words returning to bite

Many analysts believe the government's inability to seek an IMF programme was because of statements the president, then in opposition, and his current vice, Dr Mahamudu Bawumia made about ex-president John Mahama IMF deal.

Akufo-Addo berated Mr Mahama in 2015 for going to the IMF.

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"For the first time in #history, an oil rich country, some five years into oil production, is seeking a #bailout from the #IMF," he tweeted.

Former President Mahama Advises Akufo-Addo how to solve economic problems

Meanwhile, has reported that for President John Mahama has shared three proposals on how President Nana Akufo-Addo can solve Ghana's current economic problems.

Speaking at the launch of a think tank, Think Progress Ghana, the theme, "Ghana's debt burden, reflections and solutions," Mahama said Akufo-Addo needs to move fast to save the economy.

At the event on Thursday, June 30, 2022, the former president said the first significant decision would be for Akufo-Addo to fire Finance Minister Ken Ofori-Atta.

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