IMF (International Monetary Fund) To Support Ghana’s Ailing Economy

The government of Ghana has directed the Ministry of Finance to open discussion with the IMF (International Monetary Fund) to support Ghana’s ailing economy.

The Ghanaian currency, the Cedi has been continuously depreciating against most of the foreign currencies despite measures from Bank of Ghana to save it. 

In its annual review of the Ghanaian economy, the IMF in May warned that under current policies, the fiscal deficit would stay at about 10.2 per cent this year and 9.3 per cent in 2015, far below the official target.

If you may recall, Dr. Mahamudu Bawumia, 2012 running mate for the opposition New Patriotic Party (NPP) on March 25, 2014 at the Distinguished Speakers Forum organized by Central University College, stated: “Mr Chairman, in conclusion, I would like to repeat without exaggeration that the Ghanaian economy is in a crisis. It is time for serious action. If government does not take the right decisions and soon, then Ghana would likely have to approach the IMF for a bail out before the end of the year.

This statement however created various controversies and criticisms from government.

However, a statement issued and signed by Communications Minister, Dr Edward Omane Boamah indicated that government has decided to go for an IMF bailout.

Read the statement below

President John Mahama met the Presidential Advisory Committee on the Economy on 1st August, 2014 at the Flagstaff House to reflect further on the range of issues affecting the Ghanaian economy.

The Committee’s discussions focused on measures aimed at restoring macroeconomic stability, promoting growth and improving the living conditions of the people.

Arising out of the deliberations, the President reaffirmed the Government’s continuing commitment to a liberal Foreign Exchange regime that provides, among others, incentives for Ghanaians, both at home and abroad, as well as Foreign Investors to invest in Ghana.

The President further decided that as a matter of urgency, measures must be taken to stabilize the Cedi in order to bring about greater predictability to the business environment.

With respect to the energy situation in the country the President directed that urgent measures be taken to expedite the coming on stream of domestic gas supplies to provide cheaper fuel for power generation as well as minimize the foreign exchange burden of crude oil imports.

Lastly, the President directed that immediate initiatives be taken to open discussions with the International Monetary Fund and other Development Partners in support of our programme for stabilization and growth.