Information Minister Kojo Oppong Nkrumah has been defending the government’s decision to seek a bailout from the International Monetary Fund The minister cited the Covid-19 pandemic and the Russian-Ukraine
war as the primary reasons for the return to the IMF He argued that Ghana’s economy was still doing better than other countries’ but there were distortions that needed fixing
Information Minister Kojo Oppong Nkrumah has justified the government’s decision to seek a bailout programme with the International Monetary Fund (IMF).
Speaking to Citi FM on Monday, July 4, 2022, the minister outlined three reasons to justify the government’s decision to fall on the multilateral institution for financial support for the troubled Ghanaian economy.
Firstly, he repeated the oft-cited Covid-19 pandemic and the Russian-Ukraine war as the significant factors that will drive Ghana under Nana Akufo-Addo to the IMF for the 18th time. He described the two events as a “twin crisis”.
“Covid-19 is the primary reason. It was a global challenge…the twin crisis [also affected us] and it’s a is a well-known problem,” he told Citi FM.
Secondly, he said although Ghana’s economy was performing better than other economies following the “twin crisis”, critical distortions within the economy needed fixing.
He said an IMF deal would fix these distortions. Experts say Ghana was facing serious economic crisis triggered by excessive borrowing way before the Russia-Ukraine war hit.
Finally, he cited Ghana’s credit score by rating agencies as another justification for the decision to seek financial support from IMF.
He said for a long time, the managers of the economy had been pursuing prudent strategies through domestic programmes to salvage the economy. Still, the country’s credit ratings have not been helpful.
“One of the major things that have affected us is our downgrade [by international rating agencies], therefore our inability to get access to the international market,” he said.
YEN.com.gh has reported in a separate story that after months of dismissing experts’ suggestion for Ghana to seek an IMF programme, President
Nana Akufo-Addo directed Finance Minister Ken Ofori-Atta to begin formal engagements with the Fund for an economic programme. High public debt, rising inflation and depleting foreign reserves have destabilised the balance of payment.
Economic hardship in Ghana has remained a topical national issue since the start of 2022. Many, especially the opposition National Democratic Congress (NDC), have accused the government of mismanaging the economy and plunging the country into a crisis.