The Vice President, Dr Mahamudu Bawumia has broken his silence on Ghana’s move to the International Monetary Fund(IMF) for support to stabilise and revitalise the economy.
He has listed four reasons why Ghana opted for the IMF support and categorised them into two internal and two external causes.
For the internal ones, he said the energy sector take or pay agreement and the banking sector clean up were the reasons.
He attributed the external reasons to COVID-19 and the Ukraine invasion by Russia.
Going to IMF
Speaking when he launched two new high level information technology programmes at the Accra Institute of Technology (AIT) at Baatsona, Thursday afternoon (July 14, 2022), Dr Bawumia stated:
“Before I conclude, I would like to use this opportunity to make some comments on an issue on the minds of many Ghanaians: the decision by government to opt for an IMF program to stabilize the economy in the midst of global crises (the COVID-19 pandemic and the Russia Ukraine War).”
“A crisis which has visited untold hardships on Ghanaians with rising prices of virtually everything from fuel to bread, tomatoes, building materials and so on. In the midst of this global crisis, Ghana’s fiscal and debt sustainability has worsened.”
As part of measures in planning to stabilise the economy in future, Vice President Bawumia said the government has started implementing a policy that gives the Bank of Ghana (BoG) the right to purchase any amount of gold mined in Ghana.
After the central bank had purchased the gold at world market prices, the mining companies could export the remainder, he added.
“Ultimately, once we accumulate enough gold, future borrowing and our currency can be backed by gold. This will stabilise the cedi long term,” Dr Bawumia stated when he launched two new high level information technology programmes at the Accra Institute of Technology (AIT) at Baatsona, Thursday afternoon (July 14, 2022).
The Vice-President said the first right of refusal given the BoG to purchase gold mined in the country was backed by law to deepen the gold purchase programme the BoG started to build up the country’s reserves.
He was explaining the reasons that forced the country into talks with the International Monetary Fund (IMF) and measures outlined to transform the economy to make it resilient to withstand shocks.
