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Gabby Otchere-Darko hints of IMF bailout

Government has subtly started gauging public opinion on the possibility of seeking a bailout from the International Monetary Fund (IMF).
This comes after the Akufo-Addo government openly rejected recommendations to seek help from the Bretton Woods institution rather than implementing the E-levy.
Ghana is facing difficulty in servicing her debt and statutory obligations as dwindling investor confidence triggered high inflation rate and the continuing depreciation of the cedi.

Key confidant of President Akufo-Addo’s administration, Gabby Asare Otchere-Darko has in a series of tweets admitted the economy is heading to a crash.

According to him, the Electronic Transactions levy which government said would raise enough to address Ghana’s fiscal and infrastructure deficit is failing to raise the needed revenue.

In his disclosure, the E-levy is delivering just 10% of the projected revenues, especially in a period of worsening economic hardship and high public expectation after so much hype by government officials on the levy.

Gabby, in a tweet, on Monday, June 27, 2022 said, “After 5 months of stalemate and bashing, the e-levy, after implementation, is delivering only 10% of estimated revenues; our revenues remain very low as compared to the rest of the world; debt levels dangerously high, cedi, like most currencies, struggling against the US dollar,.

His admission comes barely a week after a survey by think tank IMANI Africa suggested 83% of Ghanaians have ditched Mobile Money transactions.

His tweets have triggered attacks and harsh criticisms at the Akufo-Addo government for its impunity and still wants to take Ghanaians for granted in spite of the growing anger and agitation.

In what clearly shows a quick U-turn, Mr Othere-Darko said he is not against seeking support from IMF.

His comment comes barely two weeks after a deputy Minister of Finance, John Kumah openly said in a radio interview, that option is still on the table even though government assured the public the E-levy as a homegrown solution is still better alternative to what the opposition NDC had recommended to save the poor from additional taxes.

It is not clear if government has started negotiations with the IMF but the import of the NPP leading member’s tweet appears to be signaling desperation for a new direction to inject confidence.

Ghana’s public debt hit over ¢391bn as of the end of March 2022, according to Bank of Ghana’s data. This compares to GH¢122.3 billion at end-2016.

According to the Central Bank, public debt currently inched up by ¢20.5 billion in January 2022 and subsequently ¢19.7 billion in February 2022.

In terms of the domestic debt, it went up by ¢8 billion in the first quarter of 2022 to ¢189.9 billion in March 2021. This is equivalent to 37.8% of GDP.

Meanwhile, the country’s net reserves have declined drastically to $4.672 billion in April, 2022 from $6.09 billion in January, 2022.

 

 

By Eric Ahianyo/Myxyzonline.com/Ghana

 

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