Ghana’s engagement with the International Monetary Fund (IMF) in the year 2015 has been ranked as one of the most transparent processes globally.
According to a report authored by the bloc of global organizations fighting against poverty, Oxfam, Ghana was one of the countries that had an open process in her IMF arrangement during 2015.
Oxfam Report further stated that, the openness was grounded in how the then government, His Excellency John Dramani Mahama, approached the fund leveraging on consultations with Civil Society Organizations (CSOs).
“Of all the case studies, Ghana represented the most successful example of meaningful engagement between CSOs and the IMF. This success was due to several factors which collectively amplified the power of Ghanaian civil society with respect to the IMF.
“These included: the formation of a joint coalition of over 11 CSOs in 2014, known as the Civil Society Platform on the IMF Programme – now the Economic Governance Platform (EGP); structured preparation and capacity building among the coalition prior to and during IMF engagement; the support of Global North actors such as Oxfam in accessing IMF decision makers and political stakeholders at headquarters level; detailed research and published analysis of the issues up for discussion; and public facing awareness and advocacy campaigns which included experts and stakeholders from different sectors.”
Oxfam Report
Under President John Mahama, inflation and public debt soared in the early 2015, yet Mahama’s administration turned the IMF $918 million loan support to help stabilize the economy by restoring debt sustainability, strengthening monetary policy and cleaning up the banking system.
With the IMF support in 2015, the trade and budget deficits were narrowed with a cut to wasteful spending, hence making room for much needed social services, such as relatively low fee secondary education.
Bright Simon Sides With Oxfam Report
Bright Simon, the Vice President in charge of research at IMANI Centre for Policy and Education, siding in agreement with Oxfam report mentioned that, the current IMF process is the opposite with zero government interest in openness and engagement compared to the 2015.
In 2015, Ghana’s economy was in trouble, hobbled by widening current account and budget deficits, rampant inflation and a depreciating currency. Credit dried up as interest rates rose and banks’ bad loans piled up.
At the root of Ghana’s woes was out-of-control government spending, largely to pay salaries of an overgrown civil service.
The Executive Board of the International Monetary Fund (IMF) approved a three-year arrangement under the Extended Credit Facility (ECF) for Ghana in an amount equivalent to SDR 664.20 million (180 percent of quota or about US$918 million), in support of the authorities’ medium-term economic reform program.
The program was aimed at restoring the debt sustainability and macroeconomic stability to foster a return to high growth and job creation, while protecting social spending.
The Executive Board’s decision enabled an immediate disbursement of SDR 83.025 million (about US$114.8 million).
At the conclusion of the Executive Board’s discussion, Mr. Min Zhu, Deputy Managing Director and Acting Chair, stated that the new ECF-supported program anchored on Ghana’s Shared Growth and Development Agenda, aimed at strengthening reforms to restore macroeconomic stability and sustain higher growth.
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