Economist, Dr Patrick Asuming, has described the IMF programme signed on by government as the “most costly” for ordinary Ghanaians.
According to him, the impact of the IMF programme has had adverse impact on both individuals and business, causing them significant hardships.
He revealed that a big part is the domestic debt exchange, especially with the challenges and problems that have “forced businesses, the financial sector as well as senior citizens who at this point don’t have any means at all, to make adjustments on their retirement income”.
“This is an extremely important year for us as a country. We are in the middle of the 17th IMF, and if you look at the structure of the programme we agreed this time, we decided to frontload a lot of the fiscal adjustments. So, it was quite steep, what we have had to do, even the measures we have had to take for the project to come into being are pretty drastic.
“This is the most costly IMF programme for ordinary Ghanaians by way of the nature and level of sacrifices we’ve been asked to make even in order for the programme to come into being – both ordinary Ghanaian households and businesses.”
Dr Patrick Asuming
Dr Asuming indicated that because of what government has had to do to get the IMF programme, and also due to the cycle of history whereby governments mess up during elections and then try to utilize three years to clean up the mess, the country is not fully successful and there’s the need to start all over again.
He explained that that cycle is however important as it affects the country’s progress in more ways than one.
“There’s the sense that you need a stable macroeconomic environment, stable for a long period to see real gains and begin to build substantially on it. So, when you have this cycle where every four years things go out of [order], and you spend three years to rebuild, and just when you’re about to get the economy really stable, then we start it again, it’s actually important that for once in our 4th republic, we try to maintain some semblance of discipline.”
Dr Patrick Asuming
Relevance of 2024 budget presentation
Commenting on the 2024 budget presentation by the finance minister, Ken Ofori-Atta, Dr Asuming noted that his impressions are that the budget is more consistent with what government is trying to do with the IMF programme in terms of its targets and what it achieved for 2023.
He however stated that he was hoping that given the extent of the difficulties that the economy is facing and the kind of revolutionary things the country really needs to undergo to completely change the course of how the government runs the economy, “something bolder” should have been captured, especially in repositioning the economy beyond the current IMF programme.
“Something that will ensure that we don’t come back here. When you try to change the problems that has led us to 17 IMF visits, we know there are two structural problems – there’s the structure of our economy which we always complain about that it’s been same before independence, as well as the structure of our public finances.
“So, if you look at the IMF programme, a lot of it is trying to address problems with our public finances, the way we raise revenue and the way government spends, as well as the governance processes around it.”
Dr Patrick Asuming
Moreover, Dr Asuming revealed that what the budget doesn’t actually tackle is how it can fundamentally change the way the economy works to cut dependence on imports and revamp the domestic production capacity.
He further noted that the budget failed to capture the intention of government to build a more resilient economy and diversify its sources of exports.
“… When we go to the IMF, what it does is to help us stabilize the instability we have… So, since we spent the whole of this year talking about the fiscal side, I was hoping that we now begin to see a plan on what will go afterwards. To be fair, you do see something being mentioned, but the only issue is that those things have been mentioned before. So, if you bring them back, we have to see the update…”
Dr Patrick Asuming
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