No IMF Bail-Out

Report reaching DAILY GUIDE as at press time yesterday indicated that Ghana had failed to enter into an agreement with the International Monetary Fund (IMF), after a breakdown of talks.

The IMF team is therefore expected to leave Ghana today for Washington DC in the United States of America as directed by their bosses, after detecting that the Ghana Government was not forthcoming with full particulars of the country's debt.

In view of this latest development, the expected bailout, which would have cushioned the economy and policy credibility as President John Mahama anticipated, is all gone.

The bailout would have been used to support the 2015 budget which will be read in Parliament by Finance Minister Seth Terkper today.

Sources said negotiations broke down because the IMF was unhappy with the lack of transparency in government spending, huge indebtedness, and the issue of corruption in government.

This latest development has dealt a big blow to the managers of the economy who wanted to use the bailout to further shore up the cedi.

The GNPC's $700 million loan contract caused a strain in the discussions as well as issues of State Owned Enterprises (SOEs) and debts which IMF insisted should be absorbed by the state as part of the country's overall indebtedness.

IMF officials met with Parliament's Select Committee on Finance yesterday ahead of their departure.

Minority member on the committee, Dr Mark Assibey-Yeboah, disclosing details of the meeting, told Joy FM's 'Top Story' they were made to understand that donors would not disburse funds when they were not sure that the government is fiscally disciplined.

'The IMF will leave town in a day or two and return probably sometime early next year. So when the board meets in January I don't think the programme would be concluded for them to submit it to the board at the IMF; and if you don't have an IMF programme, certainly, the EU (European Union) will not come on board, other donors—Japan, Canada and the rest—so that the chunk coming from donors may be missing in the 2015 budget,' he explained.

Negotiations between government and the IMF have dragged on since August, and Dr Assibey-Yeboah is projecting that discussions may end somewhere in April. 'It appears both sides have taken entrenched positions,' he hinted. 'The IMF is being 'tough' and government too is not ready to bend the rules,' he maintained.