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IMANI AFRICA Vice President, Bright Simons writes

1. Ghana waited too long to go to the IMF.

2. IMF doesn’t like basket cases.

3. Ghana stubbornly refused to sign on to the DSSI. IMF will insist.

4. It will take weeks to get an IMF staff agrmt.

5. Then the IMF Board has to agree.

6. So this is NOT a short-term option

7. The more broken an economy the longer the IMF negotiations.

8. Argentina’s latest deal has been under discussion for 2 yrs now.

9. Zambia’s for ~5yrs.

10. A Staff Agreement requires Ghana to accept facts it keeps resisting

11. Ghana will have to sign on to DSSI

12. So months.

13. In the meantime, it is critical to stem the bleeding.

14. Borrowing has to drop significantly to impact yields on existing & new debt.

15. That starts with abandoning ALL VANITY PROJECTS.

16. And a new attitude to highly wasteful spenders like the Electoral Commission.

17. Whilst the IMF announcement may have prevented another rating downgrade in the near-term, any prolonged delay in securing an agreement may actually trigger a downgrade.

18. The fiscal situation is such that unless the deal leads to a debt restructuring, investors won’t bite.

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