Economist says IMF bail-out will be painful

Mr Kenneth Kwamina Thompson, Chief Executive Officer of Dalex Finance, on Tuesday predicted that the International Monetary Fund (IMF) bail-out government is seeking will be painful, thus advising all to brace up. “There is going to be an attempt to curb expenditure, public sector wage bill would have to be managed, IMF is going to recommend the removal of subsidies on things like petrol, electricity, water and we will be required to do things in a certain way," he said. In an interview with the GNA on the government/ IMF bail-out, Mr Thompson said there were other positive outcomes Ghanaians could look up to with the bail-out. “The positive thing is that the depreciation of the cedi will slow down. This is also an opportunity for people who export to take advantage as Ghanaian exports will be cheaper and it will also enable us to make the structural changes in our economy that we all talk about," he said. Mr Thompson appealed to the government to tackle corruption and added that “until corruption is managed, the benefits of the bail-out will not be attained”. He called for one voice in dealing with the Bretton Woods institution, saying the last time Ghana went for an IMF bail-out was during the “decade of silence”. “At that time, I don’t think Ghanaians were able to contribute towards the debate. Now, it is not going to be that easy because everybody has a radio...and people would want and expect that they will be part of the debate,” he said. Mr Thompson said the whole government machinery should be in unison. “We need the government to speak with one voice…and carry the people along. If corruption is not manages it will literally erode the benefits of the bail-out”. President John Dramani Mahama had explained that the decision to open discussions with IMF was not because of the failure of government’s own home grown solutions but rather because of the need for policy credibility and confidence from the international financial institutions, capital markets and investors for the measures been implemented to restore economic stability and growth. He said turning to the IMF was a decision to gain the seal of approval from the Bretton Wood institution for the country’s homegrown measures.