[ 2014-04-19 ]

Postpone IMF bailout plans - James Avedzi tells gov't
Ghana must put on hold, for at least a year, any
plans of seeking financial bailout from the
International Monetary Fund, the Chairman of the
Finance Committee of Parliament has suggested.

James Avedzi told Accra-bassed radio XYZ that
though Ghana may need such a bailout in the short
term, he would rather the country waited a little
longer, to see what fruits will be yielded from
certain home-grown measures that are currently
being implemented to shore up the economy.

“Now there are challenges, so we might want the
Fund to assist. And when the Fund is coming for a
programme, they come with a lot of
conditionalities and most of those
conditionalities that they'll be thinking about,
we are already implementing…so the question is
'why don't you wait for a while and see the
outcome of those things that you've started
implementing?'”

According to him, “if you wait for some time and
it's not working then you think about getting
assistance, but if you start implementing
home-grown solutions and at the same time rushing
to go for assistance, you might not see the effect
of your own domestic programmes…so that is why I
said we might need it, we might not need it. But
if you asked me, I'll say let's wait for some time
and see how our measures that we are putting in
place are going to work before we take a
decision.”

Ghana has already done away with subsidies on
utilities and also intends freezing public sector
wage increments for 2014. There has also been a
freeze on public sector employment.

Mr Avedzi also denied earlier reports that the
Ghanaian delegation that went to the IMF/ World
Bank Spring Meetings in Washington recently, of
which he was a member, had intended to put in a
bailout request.

Ghana's economy is currently experiencing some
turbulent times with the local currency tumbling
against the dollar and other major international
currencies of trade. The country also spends more
than 70 percent of tax revenue to pay about
650,000 employees in the public sector.

The Bretton Woods Institutions have had cause to
complain about the huge amount of tax payers'
money doled out to pay workers. It totals about
Ghc9.2 billion.

The amount has been blamed largely for the
spiraling budget deficit experienced in the past
few years. Also ratings agencies like Fitch and
Moodys have downgraded the country's prospects and
outlook several times in the past few months.

Source - RadioXYZ

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