It has come to light that the International Monetary Fund (IMF) is not just asking assistance from Ghana and that more than half of the world's nations have also requested emergency loans to deal with the financial crisis brought on by the worldwide coronavirus epidemic.
At a gathering of G20 finance ministers and central bank governors in April, IMF Managing Director Kristalina Georgieva allegedly stated that more than 100 nations had requested emergency assistance.
According to a CNN story, Kristalina declared that the IMF was prepared to utilise its "whole toolbox and $1 trillion firepower" of lending capabilities to get nations through the economic storm.
10 nations had gotten emergency financing as of March 2022, according to the study, and the remaining half were expected to get their sought financial lifelines by the end of April this year.
In an effort to speed up Ghana's recovery from the COVID-19 epidemic and, more recently, the Russia-Ukraine conflict, the government stated on Friday that it has begun discussions with the IMF to offer balance of payment support.
In a statement, Kojo Oppong Nkrumah, the minister of information, announced that President Akufo-Addo had given the finance minister, Ken Ofori-Atta, permission to begin official contacts with the IMF to travel and support economic programmes developed by Ghana.
The minister explained, "This is in response to a telephone call between the President and Miss Kristalina Georgieva, the IMF Managing Director, signalling Ghana's desire to engage with the Fund.
The cabinet reportedly expressed agreement for the choice at a meeting on June 30, 2022, according to the statement.
In an effort to speed up Ghana's recovery from the COVID-19 epidemic and, more recently, the Russia-Ukraine conflict, he said, "the engagement with the IMF will strive to give balance of payment support."
In a TV appearance later that day, the minister clarified that the economic difficulty is "not locally created, but rather an outside imposed problem."
The COVID-19 outbreak and the Russia-Ukraine war have both had a severe influence on the nation. The negative effects of global supply chain disruptions, which are harming our economy, have made the situation worse, said Mr. Oppong Nkrumah.
He claims that in order to adequately respond to the crisis, the government has recognised the necessity to use the IMF, which is the most affordable and accessible alternative for doing so.
The minister told Ghanaians that the choice is in the best interests of the country and emphasised that domestic initiatives to reduce the impact of the Ukraine war on the country's finances had not yet produced the intended outcomes.
He said that the NPP administration had already demonstrated that it consistently placed Ghana first and that it would use every effort to ensure that the nation was not taken advantage of during talks with the IMF.
Pyrrhic Success
The NDC said last Friday that they had been successful in persuading the NPP administration to approach the IMF, stressing that the move was long overdue.
However, a prominent NPP member, Gabby Otchere-Darko, has retaliated, saying the opposition group and its 2020 candidate ought to reconsider.
"If John Mahama and the NDC believe that the NPP approaching the IMF now would ensure the NDC's victory in 2024, they had best think again. In response, he tweeted, "It rather relieves pressure off our government to focus on things that will have a good influence on the economy over the next 15 months.
IMF Loans
The IMF claims that it helps crisis-affected nations by offering financial assistance to provide them breathing room while they adopt adjustment programmes to restore economic stability and development.
According to the Fund, it also offers preventative funding to aid with crisis prevention and insurance. To accommodate nations' shifting requirements, the IMF regularly improves its lending toolbox.
The root causes of crises might be internal, external, or a combination of the two. Dr. Touna Mama, the IMF's resident representative in Ghana, has acknowledged that the authorities have asked the Fund to support Ghana's economic programme and that the Fund is prepared to help the nation regain macroeconomic stability.
"We can confirm that the government has contacted the fund to ask for funding for Ghana's own economic plans. The IMF is prepared to help Ghana regain macroeconomic stability, protect debt sustainability, advance inclusive and sustainable growth, and deal with the epidemic and effects of the war in Ukraine.
After the government's formal statement, he tweeted, "We are looking forward to meeting with the authorities in the coming weeks to start the initial negotiations."