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23 July 2017

‘We can stand on our feet’ Akufo-Addo declares as he bids farewell to IMF programme

Ghana is capable of standing on its own feet without the support of the International Monetary Fund, the president Nana Akufo-Addo has said.

In a comment that is destined to break the three-year economic ties with the IMF, the president said the country will chart a new path of growth and development free from the influences of the IMF.

He was answering a question from a journalist at his first media encounter to mark his sixth month in office as president.

The John Mahama-led government entered into a three year bailout plan with the IMF in 2014.

Years of borrowing and over spending meant the country was running at an unsustainable budget deficit which was close to 70% of GDP.

The budget deficit was worsened by a plummeting cedi, high inflation with a high cost of borrowing.

With little option on the table, the erstwhile John Mahama government proceeded to the IMF in 2014 for an Extended Credit Facility arrangement.

According to government spokespersons, the IMF bailout programme was to provide “policy credibility” to government.

As part of the arrangement, Ghana benefitted from a total of US$918 million which was distributed in tranches.

With a new government in place, there were suggestions President Akufo-Addo will end the IMF programme, a move some economists disagreed with.

But if there were any doubts about the country’s economic paradigm and its relationship with the IMF for 2018 financial year, the president has said emphatically, the IMF programme will end in 2017 and the new budget will be home grown policies of a government ready to take its destiny into its own hands.

“We are in a situation where critical parts of the budget of our country require foreign grants on health and education.

“We’ve got our way out of that situation and so that we can stand on our own two feet and design our future free of external influences.

“I believe strongly in that and I believe we are capable of that.

“There is no question of the IMF being extended,” he said. It will end as agreed in April 2018, he stated.

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