The Chairman of the Finance Committee of Parliament, Kweku Kwarteng, has stated that borrowing from the International Monetary Fund (IMF) and World Bank are badly needed to “hold the economy”.

He argued that the country needs a cheaper external funding support since it is no more permitted to go to the Eurobond market to borrow under an IMF programme.

“Nobody is lending to Ghana now. This is because of the debt restructuring and freeze. These funds coming to Ghana now under the IMF programme can be described as a major source of foreign exchange for the economy, he said.

Mr. Kwarteng, who is also the Member of Parliament for Obuasi West disclosed this on PM EXPRESS BUSINESS Edition on March 14, 2024 with host George Wiafe.

He maintained that the current economic position of the country cannot be solely sustained by internal funding.

“Looking at our current situation, we badly need these support from the World Bank and IMF to help stabilize the economy” .

“If we want to avoid the long queues at the fuel stations, and ensure that essential medicine are not affected,  then these facilities coming from the World Bank under the IMF programme should be encouraged”, he advised.

Rising expenditure and revenue challenges 

Mr. Kwarteng noted that since independence, various governments have ended the year with a budget overrun or recorded a deficit, contributing greatly to the current debt crisis facing the economy.

He added that more stringent measures needs to be  implemented to check overruns, adding that the current economic challenge can be linked to decades of overruns and unapproved spending over the years.

“We are here as a country because we have been spending resources that we have not raised the required money to support these expenditure”.

Mr. Kwateng noted that “we should be careful how we manage public funds, as it could soon push us into the category of fail state”.

He justified the recent debt exchange programme, saying the current economic circumstances warrant the action.

On revenue, the Member of Parliament for Obuasi West said there is the need to collectively improve revenue collection.

“We need to work on the whole structure, used in mobilizing to deal with the shortfalls and the required fundamental reforms”.

Mr. Kwarteng made a case for review of the whole tax exemptions policy to ensure that there is no discrimination.

“If this programme is not handled well, it could also create some corruption as well”, he warned.