Gov’t turning from E-Levy to IMF a display of try and error, policy uncertainty – Prof. Lord Mensah

A lecturer of Finance at the University of Ghana (UG), Legon, Prof. Lord Mensah says the government’s decision to implement the Electronic Transaction Levy (E-Levy) was a try and error move.

Sharing his thoughts on the U-turn to the International Monetary Fund (IMF) following the failure of the E-Levy to rake in the expected revenue, the Finance experts add that it is a show of policy uncertainty on the part of the managers of the economy.

“I knew obviously that E-levy was a new thing that is being introduced onto the mobile platform and it will face reactions from the users of the platform. But the government keeps on shifting the goal post. The government gave us two options and for economic management you always have options.

“For prudent and optimum management, what you do is that you are managing the economy. You select the best option to maximize the usage of that option. Effectively we had the option of going to the IMF. Speaking on the E-levy, because they the people managing, they speak by the numbers and the projections that will favor the economy.

“I believe that when they selected the E-levy and in the end that should be able to help us but then to turn around and come to tell us that you are going to the IMF within a month of the introduction and implementation of the E-levy it generates what we call policy uncertainty,” Prof. Lord Mensah told Starr News in an interview.

According to him, the try and error approach coupled with the policy uncertainty was never going to address the economic challenges facing the country.

Insisting that he is not surprised the government is engaging the IMF for support, Prof. Lord Mensah says he is expecting the IMF to come in and tone down the mismanagement of the economy.

He however bemoans the fact that it is going to have consequences.

“This economic vibrancy is not yielding anything that is expected of the economy. So the IMF will come and tone it down and in the process of toning it down it will have an impact on this economy,” Prof. Lord Mensah added.

From the information gathered today, officials from the IMF will arrive in Ghana on Wednesday, July 6, 2020, to commence engagements with the government.