The Institute of Economic Affairs has accused the present and past governments of treating the various financial crises as temporal problems without any major and permanent macroeconomic and structural policy changes to transform the economy.

Ghana returned to the International Monetary Fund this year after going through severe economic challenges last year.

In an article led by a Senior Fellow, Professor Alexander Bilson Darku, the IEA said the country’s post-crises structural policy priorities have been temporal in nature, only to satisfy donors’ conditionalities.

“Post crises structural policy priorities have been temporal in nature, only to satisfy donors’ conditionalities. For instance, various attempts by successive governments to transform the economy with reforms to improve agricultural productivity and promote industrialisation, have either been short-lived or not implemented fully, or totally abandoned”.

The article titled “The 17 Steps to and out of Financial Crises in Ghana: Lessons for the Future”, revealed that various attempts by successive governments to transform the economy with reforms to improve agricultural productivity and promote industrialisation, have either been short-lived or not implemented fully, or totally abandoned.

These chaotic attempts, it pointed out, have left the economy still highly dependent on international financing from bilateral and multilateral institutions, as well as international credit market sources. For instance, the recent shift from bilateral and multilateral loans with concessional terms, to international credit market funds with market terms, presents further international financing challenges such as debt service stress, and future financial crises based on swings of sentiments by private investors in the international capital market.

Broad-based national development programme way to go

Therefore, the IEA called for a broad-based national development programme to increase the complexity of production and exports, while providing employment to the pool of well-educated unemployed youth. These solutions, it added must be homegrown and not a set of conditionality policies for bailout credit facilities like the various IMF/World Bank programmes.

Continuing, the economic and policy think tank argued that the outcomes of these programmes for the past three decades have not been encouraging though they seem to have satisfied what they were required for.

“Besides these programmes, Ghana has followed only two government-led homegrown programmes that have created some structural reforms without access to the IMF credit facilities. These are the Nkrumah’s Import Substitution Industrialization drive (1957 to 1966) and the Acheampong and Akuffo’s Operation Feed Yourself and Operation Feed your Industry programmes (1972 to 1979).”

Though these programmes were short-lived and could not deliver their medium-term to long-term benefits to the nation, the IEA clarified that “we can also say that the visits to the IMF for financial bailout and the implementations of the associated programmes have not helped to transform the economy”, adding “the only way forward for the country to achieve its developmental goals, is by designing and implementing a homegrown national development programme with the following recommendations”.