Senior lecturer and economist at the University of Ghana, Dr. Adu Owusu Sarkodie, has underscored the improvements made in the Ghanaian economy, indicating that things are better compared to two years ago.
Dr. Sarkodie emphasised that by comparing the macroeconomic indicators for 2022 with current indicators, Ghana’s visit to the International Monetary Fund (IMF) has paid off.
“The year 2022 and early 2023, when most of the macroeconomic indicators were pointing to the wrong direction, inflation was around 54 percent and the Cedi has depreciated by 40 percent and Bank of Ghana (BoG) had to even intervene and make a loss of 60 billion [Cedis], fuel prices were skyrocketing, and so many bad things were happening”, Dr. Adu Sarkodie told Keminni Amanor on Ghan Tonight yesterday [March 18].
He added that due to economic challenges at the time, “the government had to undergo the domestic debt exchange programme, and bondholders had to endure painful haircuts.”
According to Dr. Sarkodie, “If you compare those situations where even government could not secure bonds from the Eurobond market, you compare all these terrible things and now, it has paid off, going into the IMF [International Monetary Fund] has paid off.”
The economist also reaffirmed his position that the government should resort to the IMF due to the many economic challenges.
“We have been there; now it is being paid off we are seeing the results. The economy is recovering, though we have not fully recovered,” said Dr. Adu Sarkodie, adding, “What we want to see is the economic indicators which were shown in the pre-covid time 2017, 2018 and 2019”.
However, Dr. Sarkodie quickly added that despite the improvement in the macroeconomic indicators, it is not yet one of the best.
Using inflation for example, he pointed out that, “current inflation is about 23 percent the 2022 ending-year was about 54 percent…Yes, it is better but is it the best? No”.
IMF deal has paid off?
Meanwhile, President Akufo-Addo has said his government’s decision to secure a $3 billion extended credit facility with the International Monetary Fund (IMF) has paid off, looking at the rate of recovery of the Ghanaian economy since the facility was secured in 2023.
Speaking at the Jubilee House when the Managing Director of the Fund, Kristalina Georgieva, and her delegation called on him as part of her two-day visit to Ghana, President Akufo-Addo said his administration will continue to implement sound economic policies and stay the cause concerning the current IMF programme the country is executing.
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“It is obvious that the decision we made in July 2022 to come and seek your support for the difficult economic circumstances in which we were involved, as far as I am concerned, is a decision that has already paid off. It has paid off in terms of the clear turnaround that we are seeing in our economy.
“The very dire circumstances in which we were at the time we took that difficult decision and where we are today is a very clear testimony of the fact that our decision to seek your support was a decision that was correct and we have had very positive benefits from it,” said President Akufo-Addo.
Ghana’s three-year-IMF programme is in its first year of implementation, with the nation so far, receiving a total of 1.2 billion United States dollars from the IMF in two payment tranches of 600 million dollars each.