Ghana's President-elect to Review IMF Deal

By Maxwell Akalaare Adombila

ACCRA (Reuters) – Ghana's President-elect John Dramani Mahama has announced intentions to review the country's $3 billion rescue package with the International Monetary Fund (IMF) aiming to curb wasteful spending and enhance the energy sector.

Mahama, who secured a decisive victory in the Dec. 7 election, expressed to Reuters late Friday that he also plans to address inflation and currency depreciation to alleviate the cost-of-living crisis facing the West African nation.

Previously, he indicated plans to renegotiate the IMF programme established by outgoing President Nana Akufo's administration in 2023, clarifying, "When I talk about renegotiation, I don't mean we're jettisoning the programme. We're bound by it but what we're saying is within the programme, it should be possible to make some adjustments to suit reality."

The electoral commission declared Mahama, former president from 2012-2016, as the election winner with 56.55% of the votes. He inherits a nation grappling with its most significant economic crisis in a generation, amidst turmoil in the cocoa and gold industries.

Focus on Spending and Energy

The IMF deal has helped cut inflation in half and returned the economy to growth; however, Mahama asserts that more work is essential to alleviate economic distress. "The economic situation is dire… and I'm going to put my soul, physique, and everything into it and focus on making lives better for Ghanaians," he stated. His party, the National Democratic Congress, also had significant success in the parliamentary elections held on Dec. 7.

Mahama criticized the existing arrangement, noting that the "multiplicity of taxes" tied to the IMF deal has made Ghana "unpleasant for business." He believes the IMF must instigate more pressure on the government to trim unnecessary expenditures, emphasizing that if the president advocates for fiscal restraint, he must lead by example.

He confirmed that the IMF is set to send an early mission for a regular review, aiming to facilitate smoother debt restructuring now approaching completion. Mahama also indicated that a revised IMF agreement would incorporate sustainable solutions for the ongoing energy crisis to prevent further power outages, labelling the Electricity Company of Ghana as the "sick man" of the entire value chain, stressing the need for immediate remediation.