Director of the Institute of Statistical, Social and Economic Research (ISSER), Prof Peter Quartey, has called on government to continue to respect the terms of IMF agreement.
According to him, this will keep government in the good books of the Fund and help in clinching the second tranche of the IMF funds.
He revealed that as it stands now, government is doing its best in terms of honoring some IMF conditionalities, which will enable it to qualify for the next tranche.
Prof Quartey stated that government must necessarily also secure financing assurance from its external creditors.
“So far, we are ensuring macro stability, our fiscal continues to remain resilient and positive. So, government should continue to respect the terms of the IMF agreement. Once that is done, government could still engage some of these bilateral creditors it has good relations with, including China.
“So, apart from using the IMF and the World Bank to get this assurance, government should engage bilaterally using these relationships from the past to get this assurance in as quickly as possible.”Prof Peter Quartey
Reacting to IMF’s Mission Chief for Ghana, Stéphane Roudet’s urging of Ghana to secure financing assurance from its external creditors before the next tranche, Prof Quartey indicated that it is very crucial for Ghana to obtain this financing assurance.
He explained that as part of the agreement that has been agreed upon, that is a critical requirement.
“But I believe this discussion has gone on for quite some time, the IMF and World Bank has its G20 framework which is being worked on for quite some time now. I believe they have gone very far with this – Zambia has been able to secure this assurance and its working to their advantage. So, I believe that given that we have met all the conditions, the external creditors will work swiftly on this so we can have this second tranche disbursed.”Prof Peter Quartey
Securing assurance from external creditors
Commenting on whether government will be able to secure the assurance from external creditors, Prof Quartey expressed optimism that Ghana will excel in that. He noted that it was an agreement that was signed, as such, it’s just the specifics that did not come out before the IMF even went ahead to disburse the first tranche.
“So, I don’t foresee any hurdle, I think this assurance will certainly come on board. As to the specific details, we are yet to see how deep they will go to ensure that our debt is reduced considerably is what we need. Currently, we’re borrowing a lot from the domestic market, buying treasury bills and I don’t think that’s sustainable.
“We need external assurance, we need external creditors to come on board, and we are certain as to our debt levels. I don’t think we need another round of debt exchange; two rounds are enough and therefore, this is the last stage – very critical to us.”Prof Peter Quartey
Moreover, Prof Quartey highlighted that the seeming delay with disbursemnt of funds despite meeting all of IMF’s conditions could mean many things. Among such, he revealed that the details are being worked out because certainly, all the other parties have to come on board.
“China for instance, is critical to get China to agree to some of the terms. So, I believe those fine details are being worked on.”Prof Peter Quartey