BUSINESS-ECONOMY
Ghana's newly elected president, John Mahama, said a funding arrangement with the International Monetary Fund will constrain his administration's capacity to implement quick substantial reforms. This follows a recent electoral victory that granted him a significant mandate to address the country's severe debt crisis and high inflation. Last year, the West African nation requested assistance from the IMF after defaulting on debt that had escalated to about 100 per cent of its gross domestic product by the end of 2022. The government is required to attain a primary budget surplus of 0.5 per cent of gross domestic product by the end of this year. This is as stipulated under the IMF program. Mahama said, "What it means is that the budgets must align with the IMF program, so there's not much leverage in there for making the kind of radical reforms that you might immediately need to make.” He added, "We already have requested some discussion with the IMF because we're not part of the negotiation of this program." Last week, the IMF indicated its willingness to renegotiate Ghana's $3 billion loan agreement with the next administration, contingent on the preservation of associated reforms. Mahama reaffirmed his previous stance of retaining the program. But he indicated potential adjustments to enhance economic stability, given that inflation reached 23 per cent at the end of November. Mahama said, "Bringing down inflation is the number one priority. Stabilizing the currency is number two. Bringing the deficit down, cutting expenditure, increasing revenues — i mean, those are the things that we need to be looking at." None
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