Government to replace IMF programme with social contract with labour et al.

Finance Minister Ken Ofori-Atta has revealed that government has planned to replace the 3-year programme with the International Monetary Fund with a social contract when it ends in December 2018.

The 3-year facility to Ghana was approved by the Executive Board of the Fund on April 3, 2015.

Ghana is in its final year of the $918 million extended credit facility signed to fix the country’s economy, which was dogged by high deficits, inflation and a distressing public debt.

Mr. Ken Ofori-Atta told TV3 on Thursday in Accra on the sideline of government’s interaction with top 100 tax payers in Accra that rules under the new programmes would be adhered to.

“I am hopeful we will be able to replace [the IMF programme] with a new social partnership between government, labour, religious organisations and civil society so that we as a people have our own quarterly ways of measuring what we are doing and put in some fiscal responsibility, rules such that, let say, you can’t go beyond 5%, 10% etc…”

He is also optimistic government will meet its budget deficit which it intends to cap at 5% of GDP by the end of the year considering the economic fundamentals in place.

The Finance Minister noted that government together with labour would be able to work down wages to ensure that the country’s wage bill to GDP ratio stays below the threshold for the ECOWAS convergence criteria, which is 35% of wages to tax revenue.

He said if the country is able to manage itself in that way, “we would be quite surprised the amount of revenue we will generate and how the country will thrive, I am really optimistic about that”.