The Deputy Majority Leader, Alexander Afenyo-Markin, on Wednesday, November 22, 2023, took on the opposition National Democratic Congress (NDC) and its flagbearer for the 2023 presidential elections, John Dramani Mahama, for messing up the economy of Ghana, and in the process, incurred the wrath of the International Monetary Fund (IMF).
He said that, as a result of mismanagement, the IMF programme the then-government led by Mr. Mahama rolled onto for economic bailout was not successfully implemented to the letter and therefore left a huge gap for the New Patriotic Party (NPP) administration to fill in.
Debating the 2024 Budget and Economic Policy of the Government of Ghana on the floor of Parliament, Markin, who is also the Member of Parliament (MP) for Effutu in the Central Region, said Mr. Mahama’s managerial style had a ripple effect on the country’s relationship with the IMF to the extent that the former President’s credibility was put to the test.
He said that because the IMF was having trust issues with the Mahama administration, the Bretton Woods Institution withheld some disbursements under the Extended Credit Facility (ECF) that were supposed to be made to the country.
Mahama and the NDC, he noted, failed the country as a “result of their incompetence.”
“Mr. Speaker, when the NDC and John Mahama left office, all the economic indicators were at their all-time lows. Today, vaulting ambition over leaping itself is making them feel as though their past incompetence has left them. Mr. Speaker, had I but died an hour before this chance, I would have lived a blessed time (quoted Macbeth).
I say to the NDC that the Mahama-Seth Tekper-Ato Forson economy that failed to fulfil IMF conditionalities—they failed the people of Ghana—ran to the IMF with their so-called homegrown policies, and at the time they were handing over power to the Akufo-Addo administration, the IMF had no trust in them.
As a result of that mistrust, all disbursements that were supposed to be made were not made. You failed the country,” he noted.
On April 3, 2015, the Executive Board of the IMF approved a three-year arrangement under the Extended Credit Facility (ECF) for Ghana in an amount equivalent to SDR 664.20 million (180 percent of the quota, or about US$918 million). This was to support the country’s medium-term economic reform programme.
The programme was aimed at restoring debt sustainability and macroeconomic stability to foster a return to high growth and job creation while protecting social spending.
Ghana had run to the IMF for a bailout because it was faced with a large fiscal and external imbalance that had slowed down growth and put its medium-term prospects at risk. The country’s public debt had also risen to an unsustainable pace, and its external position had weakened considerably.
Then Deputy Managing Director and Acting Chair of the Programme, Mr. Min Zhu, commenting on the ECF, said although the government had embarked on a fiscal consolidation path since 2013, policy slippages, exogenous shocks, and rising interest costs had undermined these efforts. Acute electricity shortages were also constraining the economic activity of the country.
The new IMF-supported programme, which was anchored on the country’s shared growth and development agenda, was also aimed at strengthening reforms to restore macroeconomic stability and sustain higher growth.
The main objectives of the programme were to achieve sizeable and frontloaded fiscal adjustment while protecting priority spending, strengthen monetary policy by eliminating fiscal dominance, rebuild external buffers, and safeguard financial sector stability.
Despite securing approval for about US$918 million under the ECF, the deputy majority leader said the country under John Mahama could not access all the money because the IMF halted further disbursements as a result of trust issues with the administration.
He said the track record of Mahama and the NDC should remind Ghanaians that they are not the alternative Ghana could deeply rely on. Instead, the Vice President and now flagbearer of the NPP, Dr. Mahamudu Bawumia, is the future of Ghana.
By Stephen Odoi-Larbi
