Professor Steve Hanke: U.S. Economist Says IMF Bailout Will Not Save Ghana

Professor Steve Hanke: U.S. Economist Says IMF Bailout Will Not Save Ghana

  • Prof Steve Hanke has said Ghana's economy cannot be saved by the bailout the country is seeking from the IMF
  • He said although the country has doubled its request from the IMF, the Extended Credit Facility (ECF) will fail
  • Prof Hanke's comment on Twitter follows news that Ghana has doubled its balance of payment support from $1.5 billion to $3 billion

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U.S.-based economist, Professor Steve Hanke, has said Ghana’s economy will not be saved by a balance of payment support from the International Monetary Fund (IMF).

The Economics Professor at the prestigious John Hopkins University in the United States tweeted on Tuesday, August 9, 2022, that just like Ghana’s previous bailout programmes, the current one won’t save the troubled economy.

He suggests that the country was merely begging for more money from the IMF for a quick fix.

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Steve Hanke and Akufo-Addo
L-R: Steve Hanke and Nana Akufo-Addo. Source: UGC
Source: Getty Images

His comment on the social media platform follows revelations that the Finance Minister, Ken Ofori-Atta, has doubled his bailout request from the international lender from $1.5 billion to 3 billion, and the years for repayment increased from two to at least three years.

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Prof Hanke, popular for his short but loaded tweets about countries, posted the following in reaction to Ghana’s decision to increase the bailout amount:

“Ghana passes the begging bowl to the IMF yet again. This time, it is asking for $3bn. SPOILER ALERT: Just like Ghana’s past 17 IMF programs, a new one will NOT deliver Ghana to the promised land. Today, I measure inflation in Ghana at a punishing 61%/yr.”

Steve Hanke Describes Ghana Cedi As "Bank of Ghana Junk Currency"

Meanwhile, reported in a previous story that Prof Hanke has given a grim assessment of Ghana's local currency, describing the cedi as a central bank "junk currency" as depreciation persists.

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Ofori-Atta doubles bailout request from IMF from almost $1.5bn to $3bn

The popular economist said his calculations show that the the cedi has depreciated by approximately 34% against the US dollar since January 2020.

"In #Ghana, the economy is in the tank. By my calculations, the #cedi has depreciated by ~34% against the USD since Jan. 1, 2020. The cedi is a central bank junk currency. GHA must mothball its central bank and install a currency board," he tweeted over the weekend.

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