The 2015 IMF deal was meant primarily to ensure policy credibility in order to achieve enhanced public financial management, improvement in monetary policy management and institutional reforms. When the main purpose of the program is achieved, we expect to experience better banking sector, stable currency and matching the size of the labor force with productivity.
We have achieved lower inflation at the expense of huge borrowing to finance fiscal deficit with a drastic reduction in capital expenditure. We have not achieved a stable exchange rate. The direction of inflation and exchange rate are not well aligned.
The IMF did not stop employment but the structure of the economy did even when growth inched up. We could not employ in the public sector even where there are vacancies because we could not generate enough revenue for the purpose. I doubt if these are the ‘doings’ of the IMF program. We tout modernized Public Financial Management Law and Fiscal Responsibility Laws because the IMF demanded them.
We wanted lower and moderate borrowing but even in the face of an ongoing IMF program, we added about $10billion(more than Ghc53 billion in two years with estimated repayment cost for 2019 as Ghc 18.6 billion. We expanded public expenditure beyond revenue generation in an IMF program. We announced one district one factory, one dam one village, $1million per constituency all under ongoing IMF program. We announced Ghana Beyond aid though there is no approved document by parliament and implement Free SHS and NaBCO all under an ongoing IMF program.
We have experienced many breaches of the public procurement laws and unbelievable abused of petroleum revenue management law especially the 70% rule under the ABFA as well as the 25% rule to service the Ghana Infrastructure Investment Fund all under an ongoing IMF.
We were to exit the IMF program in April 2018, we explained we wanted the exit to align with the fiscal year, yet the exit is in April 2019 which is not aligned with the 2019 fiscal year after all.
So at exit what is the sin of the IMF program? Is it the policy credibility which simply means the approval of the homegrown strategy document by the IMF assured international financial and investment institutions, governments and development partners that measures taken by the government of Ghana are solid? Hence the support and a new outlook for the country.
Have we kept in custody any greener pastures under lock and key and gave the key and policing to the IMF for which the exit means handing over that key to us? What is the sin of the IMF program? Perhaps one may ask what is the sin we want to commit post IMF exit?