The IMF Bailout: How Did We Get Into This Mess?

A fortnight ago the Government of Ghana announced its intention to request for an IMF Bailout to salvage the country’s economy which to all intends and purposes is in crisis. As is typical of Ghanaians, radio and television discussions are now focused on whether an IMF Bailout is good or bad. Some even have the nerve to suggest to the IMF what it should do with the bailout funds.

It is very strange how Ghanaians take serious matters so lightly and move on with their lives as if there is no care for tomorrow. We at the SCANDAL are scandalized by nonchalant and the indifference with which Ghanaians are treating the matter.

This country did not suffer and natural disaster; not an Earthquake, nor Tsunami, nor Drought, nor Famine. It has been normal times in this country with a lot of God’s Grace. For the first time in our history the country began producing oil in commercial quantities in 2010. Now we are even about to produce our own gas. Cocoa and Gold prices on the international market rose to unprecedented levels until 2013 when they slumped.

We also picked up so many loans that moved our public debt from GH8 billion in 2009 to GH¢54 billion within five years. Though some of were not happy it was still money pumped into the local economy or so we thought.

Then all of a sudden we realize that our local currency, the Cedi could no longer hold her own against our major trading currencies; the dollar and the pound. We also notice that our government is no longer able to pay statutory funds even though the government collects these taxes.

Within the same period many salaries and allowances of government workers are in arrears. Hospitals are running short of supplies in drugs. Doctors, Teachers, Nurses and every conceivable public sector worker is dissatisfied.

After several attempts to keep the real economic situation under wraps the Government finally admitted that all was not well with the economy and that the country like Greece, Cyprus, Portugal and Italy needed a bailout from the International Monetary Fund.

So the questions the SCANDAL is asking today are HOW DID WE GET HERE? WHAT HAPPENED? We are told that our rising public debt has resulted in an unsustainable increase in interest payments. We are also told that (and indeed we have observed) that the local currency has in the last year alone depreciated by about 40 per cent bringing us to GH¢4.00 to One US dollar today. We are also told that Government’s over expenditure in the run up to the 2012 general elections was in region of USD4 billion and that it has it has created a big hole (deficit) in our finances.

Meanwhile the Government has not changed. The Cabinet remains intact. The Government Economic Management Team remains the same. No questions have been asked. Nobody has taken responsibility for what has happened. Nobody has owned up or even offered an explanation. And now this same group of people has applied for an IMF Bailout.

Ghana went to Brazil in June this year for the world cup and performed poorly. Upon the return of the team the Government set up a Presidential Commission to investigate and to find out what went wrong. Even for as little as the Ghana @ 50 budget the Government set up a commission. We cannot believe that after a whole national economy has come to its knees like we have now no one has taken responsibility and no one is asking questions. If you were a businessman or woman and you employed a Chief Executive Officer to run your business. If the business goes bankrupt you necessarily will have to sit the CEO down and to find out what went. What is wrong with us? Or are we the only ones who seem to see things from a different perspective?