Finance

IMF loan won’t save Ghana’s economy, it will fail like previous programmes

Prof. Steve Hanke, renowned international economist at the Johns Hopkins University-USA

Ghana has turned to the IMF 17 times

Ghana facing economic distress

Ghana cedi is a central bank junk currency, Steven Hanke

A renowned international economist at the Johns Hopkins University in the USA, Professor Steve Hanke, has stated Ghana’s decision to enter an economic programme with the IMF will not salvage the economy.

He predicts that a financial bailout from the Bretton Woods Institution is likely to fail just like the previous 17 IMF programmes that Ghana has participated in.

In a July 2 tweet sharing his view on government’s decision to commence formal negotiations with the IMF for a bailout, Steve Hanke questioned Ghana’s last-ditch effort to save the economy which is in distress and saddled with a huge debt burden.

“Today, I measure inflation in Ghana at a stunning 49.35%/yr. In a last-ditch effort, the government has begun negotiations with the IMF on a bailout deal. SPOILER ALERT: Another IMF loan won’t save Ghana’s economy. Like its past 17 IMF programs, a new one will fail.”

In another separate tweet on July 2, the renowned American economist ranked the Ghana cedi in 16th place out of 18 other currencies on his Currency Watchlist – due to the persistent depreciation of the currency.

“#Ghana is in 16th place in this week’s Hanke’s #CurrencyWatchlist. By my calculations, the #cedi has depreciated ~29% against the USD since January 2020,” Steve Hanke shared.

“The Ghanaian cedi is a central bank junk currency,” the Johns Hopkins University economist added.

Meanwhile, Ghana’s finance minister, Ken Ofori-Atta has come under intense pressure over the management of the economy which is now seeking formal engagements with the International Monetary Fund for a financial bailout.

Despite stiff opposition against a return to the IMF earlier, President Nana Addo Dankwa Akufo-Addo on July 1 authorized the finance minister [Ken Ofori-Atta] to engage the IMF for an economic programme.

The IMF in response to the decision indicated its preparedness to assist Ghana on the path of its economic recovery.

In a social media post on July 1, the IMF Resident Representative for Ghana, Dr. Albert Touna-Mama, confirmed that the Ghanaian authorities have reached out to the Bretton Woods Institution.

He also mentioned that the Fund was ready to assist Ghana government to restore macroeconomic stability and safeguard debt sustainability for the country.

“We can confirm that the authorities have been in touch to request Fund’s support to #Ghana’s own economic program. The #IMF stands ready to assist #Ghana to restore macroeconomics stability; safeguard debt sustainability; promote inclusive and sustainable growth; and face the impact of the war in #Ukraine and the lingering pandemic. We are looking forward to meeting with the authorities in the coming weeks to start the initial discussions,” Dr. Albert Touna-Mama tweeted.

Government and IMF officials are expected to in the coming weeks meet to begin the formal discussions.

 

Source: www.ghanaweb.com

Ogyem Solomon

Solomon Ogyem – Media Entrepreneur | Journalist | Brand Ambassador Solomon Ogyem is a dynamic Ghanaian journalist and media entrepreneur currently based in South Africa. With a solid foundation in journalism, Solomon is a graduate of the OTEC School of Journalism and Communication Studies in Ghana and Oxbridge Academy in South Africa. He began his career as a reporter at OTEC 102.9 MHz in Kumasi, where he honed his skills in news reporting, community storytelling, and radio broadcasting. His passion for storytelling and dedication to the media industry led him to establish Press MltiMedia Company in South Africa—a growing platform committed to authentic African narratives and multimedia journalism. Solomon is the founder and owner of Thepressradio.com, a news portal focused on delivering credible, timely, and engaging stories across Ghana and Africa. He also owns Press Global Tickets, a service-driven venture in the travel and logistics space, providing reliable ticketing services. He previously owned two notable websites—Ghanaweb.mobi and ShowbizAfrica.net—both of which contributed to entertainment and socio-political discussions within Ghana’s digital space. With a diverse background in media, digital journalism, and business, Solomon Ogyem is dedicated to telling impactful African stories, empowering youth through media, and building cross-continental media partnerships.

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