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Ghana needs an IMF programme urgently – Expert tells government

Dr. Williams Peprah.png Dr. Williams Peprah is a financial analyst

Thu, 23 Jun 2022 Source: www.ghanaweb.com

IMF is the only best option, Dr. Peprah

Ghana’s net reserves reduce

Govt does not have option to borrow from international market


Associate Professor of Finance at Andrews University in the United States, Dr. Williams Kwasi Peprah, has stated that Ghana needs to hasten up with its decision to apply for an International Monetary Fund programme.

According to him, the current state of Ghana’s economy requires the pumping of enough foreign reserves to deal with the cedi’s depreciation among other pertinent economic challenges.

Ghana’s current net reserves have reduced substantially from US$6.09 billion in January 2022 to US$4.672 billion in April 2022.

However, in February 2022 and March 2022, the country’s net reserves stood at US$5.867 billion and US$5.134 billion respectively.

Dr. Peprah noted that the depletion of the country’s net reserves is an indication of the country’s weak fundamentals that need to be addressed.

“As a country, we have to be thinking of going back to IMF to seek support in terms of getting foreign currencies to shore up our depleting gross international reserves and also our foreign currency reserves. So, if you look at the issues as the BDCs request for foreign currency whereby the Central Bank is only giving them 22% of the $450 million required, it’s serious.”

“This is the only request coming from the BDCs. what about other extractive industries, the telcos," he questioned.

According to the economist, the IMF is the country’s best option since it may not be difficult for Ghana to borrow one billion dollars from the international market after its downgrade by international rating agencies.

“In the past, the government would have gone to the international market to borrow one billion dollars but we don’t have that option now.”

He also added that “the issue of all this is that the black market will dominate the pricing of foreign currency because of the shortage and this will have an impact on our inflation computations. So, we are going to see high inflation.”

"I repeat, the government must look at the option of going back to the IMF to seek money for our international reserves”, he stated.

SSD/FNOQ

Source: www.ghanaweb.com
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