A former Deputy Minister of Information, Felix Kwakye Ofosu, says government could have avoided the current economic crisis had it sought interventions earlier.

According to him, the government was aware the economy was failing, but since it had touted itself as better managers, it struggled to seek external support.

“By the first quarter of 2021, it was obvious that we had to go to the IMF. The Minority warned them, Civil Society Organizations warned them, academics like Prof Bokpin warned them but they refused and the reason why they refused was just so that you and I could not say that Akufo-Addo government went to the IMF,” he said.

Speaking on Newsfile on Saturday, he explained that the government struggled to restructure its debt because it went to the International Monetary Fund (IMF) late.

“They went to the IMF so late that the only way the IMF could touch us with a long pole was to have our debt reduced. And we are talking about some GHS 300 billion that has to be chalked off our debt because they have to get to a debt to GDP ratio of 55% and no country in recent years have had to do a drastic debt reduction,” he said.

The former Information Minister stressed that although stakeholders had taken steps to draw government’s attention to the crisis, the issue had been politicised. 

“Indeed, it is not as though when they were getting here, they were not warned. They told us they had the capacity to manage the economy, indeed they were even hiding some of our debt at a time where red flags were appearing that we are nearing a danger zone.

“Even when we had some time right after the elections in 2020 to take some quick action to avert this catastrophe, they acted amateurish in their politicking,” he added.

Mr Kwakye Ofosu further expressed disappointment in the fact that government continues to blame other factors instead of accepting responsibility.

He added that it was more worrying since “the President has even refused to heed calls to downsize his government.”

Background

Following an economic downturn and difficulties in servicing its debt, the government implemented the domestic debt exchange programme to give itself more time to meet its fiscal obligations.

However, the programme upon its announcement faced stiff opposition from groups and individuals. 

Without the debt exchange programme, the government warned that the nation’s economy would collapse.

Ghana is currently requesting a $3 billion bailout from the IMF to bolster the struggling national economy.

Before the Bretton Woods institution’s board would evaluate Ghana’s request, one of its requirements is the domestic debt restructuring scheme.

A staff-level agreement between Ghana and the IMF was achieved in December, opening the door for the $3 billion rescue.