FLASHBACK: IMF is a short-term solution to our economic problems – IEA

Director of Research at the Institute of Economic Affairs (IEA), Dr John Kwakye, on September 13, 2022, averred that government's decision to run to the International Monetary Fund (IMF) for financial bailout was a short-term solution to the country's economic woes.

According to him, a long-term solution was required to deal with the economic crisis.

In a tweet, the economic expert said, “IMF is a short-term solution to our economic problems.”

“The long-term solutions require fiscal discipline and mobilising our own abundant resources to support policies that would transform the economy from its colonial structure to a modern industrial economy,” he added.

Read the full story originally published on September 13, 2022 by Ghanaiantimes.

The Director of Research at the Institute of Economic Affairs (IEA), Dr John Kwakye, has described the government’s engagement with the International Monetary Fund (IMF) as a short-term solution to the country’s economic challenges.

According to him, the long-term solution required fiscal discipline and mobilising the country’s abundant resources to support policies that would transform the economy.

In a tweet on Saturday, the economic expert said “IMF is a short-term solution to our economic problems.”

“The long-term solutions require fiscal discipline and mobilising our own abundant resources to support policies that would transform the economy from its colonial structure to a modern industrial economy,” he added.

However, some economists and the Ghana Trades Union Congress have expressed their concerns because of the conditions that an IMF programme comes with.

But others are of the view that an economic programme with the Fund is long overdue since the Ghanaian economy has lost credibility following the downgrade of its credit rating by all three rating agencies (Fitch, Moody’s and S&P).

This has denied the country access to the international capital market, whilst inflation and the local currency have been impacted significantly.

Despite all these challenges, the IMF Managing Director, Kristalina Georgieva, has reiterated her outfit’s commitment to reaching an agreement with the government by the end of this year for an economic programme.

According to her, Ghana’s current economic woes are not self-inflicted ones but exogenous shocks such as COVID-19 and the Russian/Ukraine War.

Speaking with Joy News at the Africa Adaptation Summit in Rotterdam, Holland, Madam Georgieva, said the present economic imbalances are not due to bad policies by the government.

Again, the new IMF Mission Chief for Ghana, Stephane Roudet, arrived in the country last week.

Roudet whose appointment took effect from September 1, 2022, paid a visit to the Minister of Finance, Ken Ofori-Atta and his team and the Governor of the Bank of Ghana and his team as well.

Roudet’s visit lays the groundwork for a full mission towards the end of September 2022.