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BusinessDepreciation of cedi may impede IMF program - Ato Forson

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Depreciation of cedi may impede IMF program – Ato Forson

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The Minority Leader in Parliament, has voiced apprehensions regarding the government’s management of the Ghanaian cedi, Dr. Cassiel Ato Forson, foreseeing potential disruption to the International Monetary Fund (IMF) program by year-end.

Dr. Forson criticized the government’s fiscal strategies, suggesting that efforts to stabilize the national currency are insufficient and could have adverse economic repercussions.

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On Wednesday, May 15, the minority caucus raised alarm over the government’s recent borrowing of GH¢7 billion from the treasury bills market to compensate contractors outside its budgetary allocations.

According to the Minority, this practice of exceeding budget limits for political reasons is exacerbating the depreciation of the Cedi against the dollar.

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In an interview with Bernard Avle on the Citi Breakfast Show on Thursday, the minority leader highlighted the likelihood of the IMF program encountering setbacks, which was initially progressing well.

“I must be frank; this program is likely to veer off course by the end of this year, and rectifying it will take time. I am certain of that… let’s wait and observe. It primarily hinges on the fiscal aspect,” he remarked.

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Dr. Ato Forson further elucidated that the forthcoming IMF review, pivotal for releasing the third tranche of the 3 billion External Credit Facility, would rely on outdated data from the previous year, failing to accurately reflect the current economic scenario.

“Let me be honest with you, this programme is certainly going to be derailed by the end of this year and it is going to take a while. I have no doubt about that… let’s wait and see. It is actually on the back of the fiscal,” he stated.

“They were on course but as you know the review dates back. So, the next review is going to use the data as of December last year. So the programme indicators to check whether the programme is performing or not is going to use data six months before the time of review.

“So, obviously six months before it was good. But I can tell you that based on the data and the way they are conducting the affairs of the policy going forward, there is going to be a complete commotion,” he stated.

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