Ghana’s economy is struggling despite IMF support, according to Finance Minister Dr. Cassiel Ato Forson. Major targets, including inflation control and primary balance, are unlikely to be met by April 2025. Inflation has risen beyond government and IMF targets, and structural reforms are delayed. The government is dedicated to stabilizing the economy but requires continued sacrifices.
Ghana’s economy is experiencing considerable challenges despite advancements facilitated by an IMF-supported program, as articulated by Finance Minister Dr. Cassiel Ato Forson. He stated that the economic improvement has necessitated significant sacrifices from domestic bondholders, external creditors, and taxpayers. Dr. Forson presented these concerns during the presentation of the 2025 Budget Statement to Parliament.
Dr. Forson conveyed worries about the likelihood of meeting essential targets set by the IMF program, including inflation control, social spending, and primary balance commitments by April 2025. He noted that all necessary structural reforms, initially scheduled for completion by 2024, have encountered substantial delays, complicating the recovery process.
Inflation figures indicate an increase from 23.2% in 2023 to 23.8% in 2024, surpassing both the government’s budget target of 15% and the IMF’s projected target of 18%. This uptick in inflation has intensified discussions with the IMF due to its adverse impact on household and business financial resilience.
Moreover, the primary balance experienced a significant deterioration, expanding from a 0.2% GDP deficit in 2023 to a 3.9% GDP deficit in 2024, contrasting sharply with the targeted surplus of 0.5% GDP. The Finance Minister indicated that this deficit growth was exacerbated by a 4.4-percentage-point decline attributed to prior administration policies.
Despite these formidable challenges, Hon. Dr. Cassiel Ato Forson reassured citizens of the government’s dedication to economic stabilization, acknowledging the necessity for continued sacrifices and difficult decisions moving forward.
In summary, Ghana’s economy is undergoing significant distress, despite the support received from the IMF. Key indicators, such as inflation and primary balance, have faltered beyond targets, leading to fears of missed objectives in the IMF program. Nonetheless, the government, through Finance Minister Dr. Ato Forson, remains committed to addressing these issues, although this will require ongoing sacrifices and tough decisions from all stakeholders.
Original Source: www.gbcghanaonline.com
