Ghana’s President Nana Akufo-Addo has sought to reassure the country his government can manage an economic “crisis” as it negotiates a loan agreement with the International Monetary Fund.
Under pressure from his own lawmakers to fire his finance minister, Akufo-Addo on Sunday night gave a television address urging Ghanaians to support his decision to reverse his position and seek an IMF loan.
Hit hard by the global pandemic and fallout from Ukraine’s war, Ghana is seeking a $3 billion credit as the country faces 35 percent inflation, a sharp fall in the cedi currency and high debt service payments.
“We are in a crisis, I do not exaggerate when I say so,” he said in his speech. “I urge us all to see the decision to go to the International Monetary Fund in this light. We have gone to the fund to repair, in the short term, our public finances.”
The IMF has opened talks with Ghana over a deal and Akufo-Addo said they expected to reach an agreement before the end of the year.
“This will give further credence to the measures the government is taking to stabilise and grow the economy, as well as shore up our currency.”
The president said the IMF deal would not mean any so-called “hair-cuts” to trim the value of the country’s debt, which would mean bondholders would lose money.
He also said the government would review import standards and support farmers in a bid to reduce reliance on now more costly imported goods.
The president also vowed to tighten measures to “restore order” in the foreign exchange markets such as controlling illegal operators as a way to support the cedi.
“I know that this is putting intolerable pressure on families and businesses. I know that people are being driven to make choices they should not have to make,” the president said of the economic situation.
Ghanaian ruling party lawmakers last week demanded that Akufo-Addo fire his finance minister and another top ministry official, adding pressure to his government over the country’s economic woes.
Unionised traders and shopkeepers in the capital Accra earlier this month also closed their businesses in a three-day protest over rising living costs.