AS the International Monetary Fund (IMF) undertakes the third review of its programme with Ghana, some economists are asking the Fund to be more frank with the country.
According to them, the IMF should eschew the diplomacy and crack the whip where necessary.
Research fellow with the Institute for Fiscal Studies (IFS),Mr Leslie Mensahsays the Fund will have to be frank in their assessment, noting that the upcoming review is crucial because “a lot of the structural benchmarks will be tested now.”
MrMensahrecalls that government had breached the IMF requirement that no new arrears should be created yet the Fund was silent over the matter.
Checks by this paper revealed that government as at January 2016 owed the Social Security and National Insurance Trust (SSNIT) about GH¢400 million.
Part of the amount has since been paid, leaving GH¢120,295.76 as outstanding as at February this year
According to MrMensah, the IMF is unhappy about the way the country’s debt is being managed but has refrained from making pronouncements on the matter.
“The concern also is that if they begin to indicate to the public and the market that government is not managing its debts well, it will worsen our plight than improve it; our Eurobond yields will shoot up immediately,” he noted.
Dr Lord Mensah of the University of Ghana Business School says the IMF will have to come up with punitive measures to avert excessive expenditure in an election year.
“If we spend excessively in this election year as happened in other years then what’s the essence of the IMF programme?” he wondered.
The review by the IMF mission is seen by many as critical because if government passes the test, it will not only pave the way for the release of about $116 million but convince investors that government is on track to stabilizing the economy and implement programmes, especially, in an election year, to match revenue with expenditure and control the rising debts.
Ghana’s debt stood at GH¢97 billion as at December 2015.
According to the leader of the IMF mission to Ghana, Joel ToujasBenarte, the country is on track so far in meeting most of the targets set under the three-year programme that will see almost one billion dollars released to Ghana by 2017.
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