Fitch Solutions, a UK-based research firm, has recently released a report stating that Ghana's opposition National Democratic Congress (NDC) is likely to win the 2024 presidential election.
The report, titled "Positive Shift in Ghana's Political Risk Profile Following IMF Programme Approval," cites the rapid deterioration of economic conditions in 2022 and slow progress in the fight against corruption as factors that will contribute to anti-incumbency sentiment among voters.
The report also highlights concerns raised by the International Monetary Fund (IMF) about President Nana Akufo-Addo's Free Senior High School programme, which has been labeled as "poorly targeted."
The potential modification of the programme to reduce spending could weaken the campaign agenda of the ruling New Patriotic Party (NPP), thereby increasing the likelihood of an NDC victory.
Despite predicting a change in government, Fitch Solutions believes that risks to Ghana's IMF programme are limited. The report notes that previous NDC governments have requested IMF loans, and the current NDC leadership has expressed support for Ghana's re-engagement with the IMF.
Fitch Solutions also predicts that Ghana's social stability will improve as the country's economy stabilizes and inflation eases. The report notes that while the government has raised taxes, a more stable exchange rate and a stronger external position will gradually normalize economic conditions. As a result, the firm expects a decrease in protest activity in the second half of 2023.
Overall, Fitch Solutions revised Ghana's "policy continuity" score in its Short-Term Political Risk Index (STPRI) to 70.0 out of 100, indicating that risks to the IMF programme are limited. The report also revised up the "social stability" score in the STPRI to 47.5 out of 100, reflecting the expectation of decreasing protest activity. Ghana's overall STPRI score now stands at 63.1, making it a regional outperformer with relatively contained political risks.
In conclusion, while Fitch Solutions predicts a change in government in the 2024 presidential election, it believes that risks to Ghana's IMF programme are limited, and the country's social stability is expected to improve.
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