Two economists are hopeful that the acceptance of around $3 billion by the International Monetary Fund (IMF) for the nation will contribute to economic recovery and stability.
However, they insisted that rigorous adherence to the program's aims would determine whether or not it was successful.
Both the University of Ghana's Prof. Eric Osei-Assibey and Prof. John Gatsi, dean of the University of Cape Coast School of Business, voiced the opinion that the agreement would help bring down inflation, provide economic stability, and lower the nation's debt to levels that were manageable.
However, they emphasized that in order for the country to fully benefit from the initiative, managers of the economy and other stakeholders must adhere to it.
Discipline
Prof. Gatsi stated in an interview with the Daily Graphic that the government must have learned from its management of the economy and would, as a result, exercise restraint and abide by the program's terms to attain the desired stability.
The professor of economics and finance stated that it was more prudent to suffer the consequences that came with the credit facility in order to ultimately put the economy back on the path of growth, even though implementing the program would present some challenges, including the need for additional domestic revenue mobilization measures in the form of new taxes.
"It is preferable for us to work with the IMF for all of these grueling exercises to occur, but whether or not our administration has learned from its mistakes is something we need to inquire about," he stated.
According to Prof. Gatsi, when a nation takes out a loan from the IMF, the government agrees to change its economic policies in order to address the problems that prompted the request for funding.
For instance, he added, the IMF had requested the Bank of Ghana refrain from lending money to the government to support the budget as a way to lower inflation because the recent spike in inflation was a result of the central bank accommodating government expenditure.
The government's failure to fund a budget forced the central bank to assume responsibility for doing so, which resulted in the degree of inflation that we have observed. This is the explanation for the inflation that we have observed," he stated.
Prof. Gatsi stated that his main criticism of the plan was the haste with which it was approved and the diplomacy that was used to close the deal.
He voiced concern that the nation would need to make a trade-off for the favor the diplomatic world had shown it.
"I assume you are aware that United States Vice President Kamala Harris announced she would send someone to the Finance Ministry, and that was really done. She also mentioned accelerating the procedure with the IMF, and they have," he added.
"So the question is, are we going to be liberal towards LGBTQ? Her primary speech to the Ghanaian people before she left was on diversity and human rights problems. Is that the cost Ghana will incur? Professor Gatsi offered a rebuttal.
blogpay
Total Comments: 0