In a determined stance, Madam Abena Osei Asare, Minister of State at the Finance Ministry, has assured that the Ghanaian government will not default on its obligations under the $3 billion loan-support programme with the International Monetary Fund (IMF).

This pledge comes as the nation approaches a highly competitive election season, raising concerns about the potential for fiscal policy deviations. Hon. Osei Asare emphasised the government’s unwavering commitment to the IMF programme.

“Consistently, we’ve kept to the programme because we know how this is important not just to the IMF, but to the people of Ghana.
“This year, we’ve had two successful reviews, and the next one is in November, for us, we’ve worked consistently with every review, and that’s what we’ll continue to do.”
Hon. Abena Osei Asare, Minister of State at the Finance Ministry

Hon. Osei Asare’s declaration is seen as an attempt to break this cycle. The Minister pointed to the recent signing of the Memorandum of Understanding (MoU) with the Official Creditor Committee as evidence of the government’s dedication to the programme. This MoU is a critical step in the ongoing negotiations with external bondholders, further underscoring the administration’s resolve to meet its financial commitments.

Hon. Osei Asare’s reassurances are significant given the historical context. In past election years, Ghanaian governments have frequently postponed or skipped IMF reviews, a practice that has drawn criticism from economists and policy experts.

The upcoming Executive Board meeting on June 28 will be a crucial moment for Ghana. At this meeting, the second review of the programme will be considered, and upon approval, it will trigger the disbursement of a third tranche of $360 million to the country.

Successful completion of this review is essential for maintaining the financial stability and credibility of Ghana in the eyes of international investors and lenders.

Professor Godfred Alufar Bokpin, a finance scholar at the University of Ghana, highlighted the importance of adhering to the IMF schedule, especially during election years. “Our own history tells us that in almost all the presidential cycles, anytime we’re under an IMF programme, the government doesn’t take the review that happens at the peak of the elections seriously,” he said.

Historically, election periods in Ghana have been marked by fiscal indiscipline, with governments often resorting to excessive spending to gain political favour. Professor Bokpin noted that this tendency to overspend and subsequently reschedule IMF reviews has had adverse effects on the country’s economic health.

To prevent a repeat of such fiscal mismanagement, there is a growing call for vigilance and accountability. Professor Bokpin advocates for collective action among the media, academia, and Civil Society Organisations (CSOs) to ensure the government does not deviate from the agreed programme.

“The next review is what we must all focus on; we must all put our voices to the table and ensure that we do not skip that important review.”
Professor Godfred Alufar Bokpin

Hon. Osei Asare’s assurances, therefore, are more than just promises; they are a litmus test for the government’s commitment to economic stability and fiscal responsibility. By maintaining the course with the IMF programme, the government aims to bolster confidence among its citizens and international partners that it can manage its finances prudently, even in the face of electoral pressures.

This resolve will be tested in the coming months, especially as the November review approaches. The government’s actions will be scrutinized not only by the IMF but also by the electorate, who are keenly aware of the stakes involved. Upholding the IMF commitments could serve as a significant indicator of the administration’s dedication to long-term economic health over short-term political gains.

While the upcoming elections present a significant challenge, the government’s pledge to adhere to the IMF programme offers a beacon of hope for fiscal discipline and economic stability. The success of this commitment will depend on sustained effort and vigilance from all stakeholders, ensuring that the country’s economic policies remain on track during this critical period.