The World Bank Country representative in Ghana, Mats Karlsson has denied the World Bank’s involvement in issues concerning Ghana’s trade policy. According to him, it is the International Monetary Fund (IMF), which has raised concerns about Ghana’s trade policy and not the World Bank.
He was reacting to a direct attack on his institution for twisting the arm of Ghana’s government to suspend the policy of raising tariffs on imported rice and poultry products.
The Statesman newspaper on Wednesday reported that the President of the World Bank, James Wolfensohn warned Senior Minister, J. H. Mensah to advise Ghana’s government to withdraw higher tariffs imposed on imported poultry products and rice or risk losing moneys voted for the country.
But Mr Mats Karlsson denied the allegation at a meeting organized by the Rotary Club of Accra West in Accra on Wednesday. His denial appeared rather odd and academic.
For he proceeded to defend the Bretton Woods institutions’ preferred policy against the government’s higher import duties on selected farm products that can be produced locally.
According to Mat Karlsson, Ghana’s policy of low trade barriers is right. “There is no reason to impose high trade barriers” as experience shows that it produces more failures than successes because it leads to high cost of locally produced goods and low cost of imported goods.
“Developing country economists feel strongly that infant industry protection does not work… I personally believe that there is no need for it. But developing countries must choose but should not choose to protect infant industries blindly”, Mats Karlsson added.
