Professor Ernest Aryeetey, Vice-Chancellor of the University of Ghana, says he is optimistic Ghana’s economy will pick up shortly with the urgency of a sustained macroeconomic management at hand.
“In the last couple of weeks we’ve had an IMF mission that has endorsed the government’s policies and efforts to bring some stability into the fiscal arrangement, so there is some movement finally.” Prof. Aryeetey told Bola Ray on Starr Chat Wednesday.
“I wouldn’t pretend that things are well,” he said, adding that there is no doubt that the situation is quite challenging citing loose fiscal policy, high budget and current account deficits, and a depreciating currency amidst high inflationary rate as the major fiscal challenges inhibiting the growth of the economy.
Asked whether the President John Dramani Mahama is managing the affairs of the country well, Prof. Aryeetey said: “Mr. Mahama is doing what he can do as best as he can in the running of the country.”
The International Monetary Fund (IMF) last week completed its third review mission to Ghana (B3negative), and concluded that the country as at the end of December 2015 had broadly met the performance criteria under its three-year Extended Credit Facility (ECF) programme.
Additionally, the year-end 2015 fiscal deficit of 6.7% of GDP in cash terms surpassed the budgeted 7.0% target and marked a significant improvement from the 9.4% deficit reported in 2014, and the country’s fiscal consolidation efforts included larger-than-expected arrear repayments.
The continued compliance with the IMF programme criteria is credit-positive because it bolsters investor confidence amid difficult domestic and external funding conditions.