Economist Dr. Nii Moi Thompson has raised concerns that the International Monetary Fund’s (IMF) programme is having a detrimental impact on Ghana’s economy, causing more harm than good.
He painted a grim outlook, suggesting that the IMF’s intervention, intended to alleviate the country’s economic woes, is instead exacerbating existing problems and worsening the crisis.
During an interview with Bernard Avle on Channel One TV, Dr Thompson predicted that Ghana is likely to re-enter the IMF programme immediately after exiting it.
He stressed that the current IMF programme is designed to lead Ghana into a vicious cycle of repeated bailouts, potentially marking the country’s 18th or even 19th entry into the programme.
“I think we’re in a very dark spot, and everybody knows that I’m just restating it. Perhaps there’s a third dimension that we don’t talk about, which is what I call the third crisis, we can get into that later, the brain drain that is happening as a result of the economic crisis we’re facing now, the debt crisis, the economic crisis.
“And the fact that what is supposed to be the solution to this crisis is actually aggravating the problem. And I’m referring to the IMF programme. It almost certainly makes things worse. So, we will exit the programme, yes, but we will almost immediately re-enter. The programme looks like it’s actually designed to lead us to the 18th one, possibly the 19th, and so on. It’s not helpful at all, it’s doing more harm than good.”
The former Director General of the National Development Planning Commission (NDPC) pointed out several key sectors that have been steadily declining due to the IMF programme.
He lambasted the government for imposing high taxes and interest rates on businesses and consumers, effectively punishing them for its economic mismanagement.
“I could just give you a couple of examples, the issue of the private sector, let’s step back and look at the moral basis of the programme itself. Why someone else will screw up the economy, that’s the government, those in charge of the micro economy, fiscal policy, and monetary policy, they messed it up.
“And then for some reason, they decided to punish businesses and consumers, who had nothing to do with that, through high taxes, high interest rates and so forth and so on. And now you see the debilitating effects on the business sector,” he pointed out.
He expressed scepticism about the government’s ability to achieve inclusive growth after the IMF programme, lamenting the significant decline in real credit availability.
He also questioned the government’s strategy for promoting equitable economic growth.
“For the past 14 straight months, real credit, inflation adjust to credit to the private sector has been declining, an average of 18% per a month. This is not the solution, 18% per month, the lowest I think is 10% and the highest is 30%. So, we’re sucking the blood out of the private sector, at the same time, we’re claiming that we’re preparing it to lead to inclusive growth after the programme. That’s not going to work.”
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