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Deputy Ranking Member of Parliament’s Finance Committee, Isaac Adongo, has alleged that government did not have enough cash and fiscal buffers in its gross international reserves long before the outbreak of COVID-19.
According to him, government in its last Article IV consultations with the International Monetary Fund stated a figure of US$6.6 billion for gross international reserves although the country did not have that actual amount in its reserve buffers.
“It is no wonder that the Ghana cedi has been collapsing because government did not have enough reserves which has exposed us to enormous external vulnerability,” he said.
“… So, with our debt burden and unsustainable level of deficit, in 2020, we run a deficit of 15.2 percent and as a matter of fact the IMF’s Article 4 Consultation paper refers it to as an unprecedented and historic deficit,” the lawmaker told journalists in parliament last week.
“In 2021, the deficit was followed up with 12.1 percent and government now wants people to believe it will be doing a deficit of 9.4 percent?” he questioned.
Touching on Ghana’s position on the capital markets, the Bolgatanga Central lawmaker opined that time will tell if the IMF has the confidence in Finance Minister [Ken Ofori-Atta] to remain committed to an IMF programme.
“I can assure you that IMF will frontload the milestones, make the needed corrections that must be done and assign the flow of monies into the economy to the achievement of the milestones and targets,” he stated.
Meanwhile, government is targeting between US$1.5 billion and US$3 billion from the International Monetary Fund under an economic support programme.
The Government of Ghana on July 1 made a U-turn on its strong position of not seeking support from IMF amid an economic downturn.
A team from the IMF arrived in the country on July 5 and have since been engaging Ghanaian authorities for a programme.
The programme is aimed at restoring macroeconomic stability and safeguarding debt sustainability among many others.
The IMF team is led by Carlo Sdralevich, mission chief for Ghana.
