A Former Dean at the School of Economics at the University of Cape Coast, Professor Ekow Asmah says he has less confidence in Ghana achieving the action points which were agreed on under the staff-level agreement reached by the International Monetary Fund and Ghana.
The IMF announced on Monday, December 12, 2022, that its staff had reached a staff-level agreement with the Ghanaian authorities.
It said the agreement is on economic policies and reforms to be supported by a new three-year arrangement under the Extended Credit Facility (ECF) of about US$3 billion.
A statement from the fund also indicated that the staff-level agreement is subject to IMF Management and Executive Board approval and receipt of the necessary financing assurances by Ghana’s partners and creditors.
The finance minister, Ofori-Atta described the speed at which the agreement was reached as a “miracle”, adding that the government is ready to complete actions required by the fund before the end of January.
But speaking in an interview with ATL FM, Professor Asmah indicated that although he is happy about the agreement, he believes government will continue to face some challenges in its bid to achieve the action points of the agreement which include the debt restructuring programme.
He said with the medium-term reform to restore the macro stability he expects some opposition to that from the minority.
“First the medium-term reform that will restore macro stability. A lot of it basically I’m sure has been highlighted in the 2023 budget. We need to get approval for that. I don’t think that should be a problem even though I know there are issues that will be raised by some parliamentarians on the tax reforms, especially the VAT increase. I’m not too sure about that, but I expect some opposition to that from the minority,” he said.
Speaking on the debt sustainability strategies to be approved with creditors, he said his challenge is that already heads from the various stakeholders are dissatisfied with the way government went about it adding that, “this is a key requirement if the country has to move this IMF view forward.”
Prof Ekow Asmah added his fears about how monies will be raised into the Financial Stability Fund.
“The third one about pursuing that financial stability, we had some comments from the ministry again that they have established or from the Stability Council that they’ve established a Financial Stability Fund. I’m not too sure again where we would be able to raise monies into this fund.”
He is of the view that there must some clarity on what will be done to achieve the structural reforms.
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Source: Rosemond Asmah/ATLFMNEWS
