Ghana has been to IMF 16 times but nothing to show – Kwakye

IEA John Kwakye Dr. John Kwakye, Director of Research at the Institute of Economic Affairs (IEA)

Thu, 24 Mar 2022 Source: 3news.com

Director of Research at the Institute of Economic Affairs (IEA) Dr John Kwakye has dismissed suggestions to the government go the International Monetary Fund (IMF) for support.

He said Ghana has already been to the Bretton Woods institution sixteen times but with nothing to show for.

Dr Kwakye stated in an interview with TV3’s Alfred Ocansey that the IMF has not been popular in most developing countries especially in Africa.

He said “The IMF in general has not been popular not only in Ghana but in developing countries in general, especially in Africa. We don’t have good examples to show that because of IMF’s involvement in a country over a period, this is what we have achieved or this is what we have to show for it.

“Even Ghana, I think there was a time, for a brief period, when Ghana was touted by the IMF and the international community as star of Africa when we were listening to them and adopting their measures. Maybe because we did slightly better during the time but on a long term basis, we have gone to the IMF already sixteen times, if we should go again that will seventeen time.

“Then you ask yourself, what do we have to show for it? This economy remains virtually like a colonial type economy, we are producing primary commodities unrefined , we don’t add enough value to it, 65 years after independence it is like we haven’t changed that much but we have been to the IMF sixteen times. How much benefit have we derived from the IMF.”

The government has been called upon to return to the IMF for support instead of relying on the proposed E-levy for revenue.

For instance, a former Member of Parliament for New Juabeng South, Dr Mark Assibey-Yeboah believed that a return would rescue Ghana’s struggling economy.

“Without a doubt, I think we should be placing a call to Washington if we haven’t really done that. We are just not going to ask for the funds just because E-levy has been passed or not. E-levy will just bring about GH¢5 billion. We are in a deep hole of our tax revenue and facing difficulties, so going to the Fund will give us some support.

“So there is nothing wrong with going to the Fund. Ghana is a member of the IMF so what is wrong going to ask for support when we are in difficulties to go and pool resources. If I was the finance minister, I will be convincing the President that it is about time we went back,” he told Citi.

Mark Assibey Yeboah also added that the revenue expected to be accrued from the E-levy is to ensure the economic stability government is eyeing.

He further cast doubt on the government’s ability to raise the projected GH¢6.9 billion target, saying the maximum the government can raise from the controversial e-levy is GH¢5 billion.

“The GH¢6.9 billion target cannot be realized. There are a lot of exemptions so, in my estimation, the maximum amount we can get from the E-levy is GH¢5 billion, and that is less than a billion dollars, so I do not think that the E-levy is going to be a panacea to our revenues. Going to the IMF will ensure some stability and above all, we are going to get some $3 billion”.

The General Secretary of the National Democratic Congress (NDC) Johnson Asiedu Nketia also made similar call to the government.

Asked whether President Nana Addo Dankwa Akufo-Addo should go to the IMF, while speaking on the New Day show on TV3 on Monday February 7, he answered “I think it is something that they have to consider. if it is the only that will take us out of this problem then the earlier the better.”

But the Finance Minister Ken Ofori Atta insisted that Ghana would not return to the International Monetary Fund (IMF) for support in order to deal with the challenges that the local economy is going through at the moment.

Speaking at the 3rd Townhall meeting on the E-levy on Thursday February 10, at the the Radache Hotel in Tamale in the Northern Region, he indicated that a return to the Bretton Woods institution will have dire consequences.

He also indicated that Ghana had the capacity to raise domestic revenue for development.

Mr Ofori-Atta who had earlier stated that the government would not go back to the IMF insisted that “I can tell you, as my colleague deputy said, we are not going back to the IMF, whatever we do we are not [going back]. The consequences are dire, we are a proud nation, we have the resources , we have that capacity, don’t let anybody tell you … we are not people of short-sighted, we need to move on,” Mr Ofori-Atta said.

Source: 3news.com