The Trades Union Congress (TUC) has described the government’s decision to formally engage the International Monetary Fund (IMF) to support an economic program put together by the Government of Ghana as “a tragic mistake and a sad one for Ghana”.

According to the TUC, this will be the eighteenth time that the country’s economy will be handed over to the IMF to manage. However, the Union noted that it is very sad because it is a clear indication that “we cannot manage our own affairs”.

The TUC highlighted in statement signed by the Secretary General, Dr. Yaw Baah, that it fully acknowledged the impact of global developments on Ghana’s economy.

However, at the same time, the current state of the economy suggests that the robust economy government claimed to have built before the pandemic was not resilient enough, the TUC stated, adding that “It must have been built on a ‘foundation of straw’ but Ghanaians were told that our economy was strong and stable”.

“It is now very obvious that the economy of Ghana is in a desperate situation. But we are of the firm view that handing over the management of the economy to the IMF is not the solution to our problems. In the Fourth Republic alone, we have implemented five IMF programmes.

“These IMF programmes have only imposed unnecessary hardships on Ghanaians with practically nothing to show for them. The solutions proffered by the Fund are not appropriate for our economy. They scratch the edges of the problem without tackling the fundamental issues facing the economy”.
TUC

The TUC indicated that the negative social implications of the religious manner in which IMF-sponsored programmes were implemented during the structural adjustment period “are still very fresh in our memories”.

“Tens of thousands of public sector workers lost their jobs, unnecessarily. For example, the last IMF-Extended Credit Facility programme (2015-2018) was conditioned on government freezing employment in the public service, among other conditionalities.
“This meant that while CHIP Compounds were without skilled medical personnel, trained nurses were picketing at the Ministry of Health and Ministry of Employment and Labour Relations for jobs. That IMF programme produced an association of unemployed graduates for the first time in the history of our country”.
TUC

According to the TUC, the programme also led to a steep decline in real wages and as such, described the hardships that the IMF programmes brought on Ghanaians as “enormous and needless”.

“What we got in return was an economy still overly dependent on production and export of raw materials and import of manufactured products. Most of our productive sectors such as mining, petroleum and telecommunications are still being controlled by foreign companies”.
TUC

IMF-sponsored programmes not a solution to Ghana’s problems

According to the TUC, Ghana’s history of engagements with the IMF provides ample evidence that IMF-sponsored programmes and policies cannot change the country’s economic circumstances.

The Congress further stated that if Ghana learns from history, it would know that countries that have succeeded economically such as South Korea, Singapore and China did not follow the neo-liberal policies based on the Washington Consensus which provide the basis for all IMF-sponsored programme.

“The only reason a government would want to seek IMF bailout is to look for short-term quick fix to our perennial economic challenges. Ghana has done this seventeen times and government has just announced the commencement of engagements for the eighteenth IMF-sponsored programme. One thing is very certain – the eighteenth IMF programme will not solve our problems”.
TUC

According to the TUC, what Ghana needs now are measures that tackle the structural constraints to economic and social development. Those measures must include policies and programmes aimed at ending the domination of foreign companies in the most productive sectors of the economy, minimise our dependence on natural resources and build a robust manufacturing base.

An economy which is dependent on few natural resources will continue to face fiscal challenges, it warned.”We believe strongly that we can achieve sustainable economic growth and development if we build consensus among the key stakeholders through a genuine social partnership”.

On July 1, 2022, the Minister for Information released an official statement to inform Ghanaians that President Akufo -Addo has directed the Minister for Finance to commence formal engagements with the International Monetary Fund (IMF), “inviting the Fund to support an economic program put together by the Government of Ghana”. The statement further underlined Cabinet’s endorsement of the decision by the President to seek IMF support.