IEA's Director of Research, Dr. John Kwakye
Dr. John Kwakye, director of research at the Institute of Economic Affairs (IEA), has questioned the government's unwillingness to implement the fiscal adjustment suggested by the International Monetary Fund (IMF) in order to attain a level of debt sustainability.
According to him, the government is focusing more on the restructuring of the debt and less on the fiscal adjustment.
This, he believes, could prolong the Paris Club and G-20 members' commitment and assurance to provide a debt restructuring guarantee.
Dr. Kwakye noted that the IMF has always advised the government of Ghana to implement fiscal adjustment programs in addition to debt restructuring initiatives.
"I examine the terminology used by the IMF in their communique. To reach the level of sustainability, the IMF suggests a combination of fiscal adjustment and debt restructuring. But it appears that our government is unwilling to implement many of the fiscal adjustments proposed by CSOs," he said.
This premeditated disregard for fiscal adjustments, according to Dr. Kwakye, is the bane of the economy.
He added that a debt restructuring accompanied by fiscal rigor would not result in sustainable debt management.
He recommended that the government implement the numerous fiscal adjustment proposals made by CSOs to assist in the economic recovery.
"Since last year, when it began negotiating with IMF staff, this government has been assuring Ghanaians that they are very near. However, a careful examination of the circumstance reveals that the date keeps changing.
One of the reasons for the postponement, according to Dr. Kwakye, could be the government's signals regarding the Finance Minister's refusal to implement fiscal adjustment.