Seth Terkper, Minister of Finance
A team of officials from the International Monetary Fund (IMF) is expected in Ghana within two weeks to finalise discussions on a bailout request the government recently sent to it.
Gerry Rice, Communications Director at IMF, at a news conference in Washington, noted that IMF has not decided on the programme it would prescribe to Ghana.
Government stated that it approached the IMF because of its inability to manage economic challenges and the continuous depreciation of the Ghana cedi against major foreign currencies.
The IMF team would possibly arrive in Ghana from September 15 and remain in the country until September 26.
Government last month tendered an official letter to the US-based lender after its magic wand in economic management failed to yield the right results.
According to President Mahama, he wants the IMF to assist government to address the budget deficit quickly and create confidence in the short-term.
President Mahama, explaining the rationale behind government’s decision to open discussions with the International Monetary Fund, said that did not connote that his home-grown solutions had failed.
Economic analysts have also warned government on its excessive spending.
Government spends a staggering 70 percent of its entire total revenue to pay public sector workers, who constitute about six percent of the Ghana’s over 25 million population.
In the case of private sector players, who employ a lot of Ghanaians too, government has imposed taxes on them rendering their operations unprofitable.
Inflation currently stands at 15 .3 percent with the producer price inflation recording 47.4 percent in July 2014.
Under an IMF programme for Ghana, analysts believe some public sector workers could be laid-off.
Also, the IMF could ask the Bank of Ghana (BoG) to carry out further policy rate hikes to help contain inflation with has hit a four-year high.
Additionally, there would be measures to remove petroleum products subsidies and utility tariffs in a bid to help reduce government’s rising debts and budget deficit.
By Samuel Boadi
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