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12.07.2022 Feature Article

Oh, Please Stop Treating the IMF as a 'Stranger'!

Oh, Please Stop Treating the IMF as a 'Stranger'!
12.07.2022 LISTEN

To say that the cacophonous noise we have been making about our talks with the IMF is déjà vu is to state the blindingly obvious.

We have had a similar public gnashing of teeth since 1966, when the late Mr E. N. Omaboe was our economic “chieftain”.

Next came the J H Mensah “economic Czar’ era, during which our most brilliant economist was badmouthed and denied a hearing by his own Prime Minister, Dr Kofi Busia.

Under Busia, groups of IMF/Western moles (disguised as objective economic consultants) were installed in the Castle in Accra, under a plausible ‘cover’ provided by Harvard and Oxford Universities. Their “advice”, which was supposed to win sympathy for Busia with the Western creditors, and thereby neutralised home-grown proposals which would have accorded with the sentiments of Busia, a professor of sociology and who had thereby been initially inspired by his ancestors to warn the West that “Kafo didi!” [A debtor can only repay his debts if he’s allowed to eat!] He got no debt relief from the West, was forced to devalue the Cedi, and his house of his regime fell like a house of cards.

Did we learn anything? No – as if J H Mensah had never existed, next came the Kwesi Botwe era, when “radical” expectations fell hard on a market-determined diktat that could be crudely interpreted as “kill the Cedi in order to save it”! Hence died any prospect of a Rawlings flirtation with socialism!

Wow! When will we learn that no-one argues with a lending institution such as the IMF? The IMF, Beloved Countrymen and Women, does not force anyone to come and beg it.

The IMF comes and the IMF goes – as it likes. The IMF decrees, and if you agree to its conditions, then the IMF pays. It then goes to sit in Washington and watches its handiwork create the desired result – whatever it is.

Lesson? If you don’t want trouble, don’t mismanage your economy in the first place. For if you wade into sticky economic waters and need to go to the IMF, your toes will fall off into icy waters. In other words, fall prey to the cliché and “cut your coat according to your cloth. For if you don’t, and you have to go to the IMF, expect your egoistic coat-tails to be unceremoniously blown apart by the winds of penury.

Yes, Beloved fellow citizens, do please keep quiet. The IMF is nothing but e a mortgage lender, whose conditionalities were first conceived in England. You borrow from it at what you consider to be an affordable (probably “variable”) interest rate. But a few years on, the Bank of England begins to raise interest rates -- taking them “as high as necessary” [to quote Norman Lamont, one-time Chief Secretary to the Treasury, during Margaret Thatcher’s premiership].

The cause may be that “sub-prime mortgages” have been oversold on Wall Street by some quaintly-named company called Fanny Mae. Or a financial wizard called Bennie Madoff has had his ponzi scheme come off the rails. And suddenly, Central Banks all over the place decide that such companies are “too big” to be allowed “to fail”! And you, poor borrower, are saddled with a monumental interest rate that may drive your family out of their home.

Yes: if you are a small player you borrow from big lenders at your peril. Maybe some of our so-called “financial wizards” have not been victims of the mortgage market before? Me, as soon as I saw people in our government boasting about how gladly loan markets abroad had welcomed their offerings and “over-subscribed” them, I gnashed my teeth!

Maybe before incoming Government takes office in Ghana, its members should be subjected – by a constitutional requirement-- to an intensive course of study, into Ghana’s economic history. For “institutional memory” is one of the worst casualties of amnesia in our public life.

Well, right now, what we should do is to keep quiet and allow our negotiators to do their best to reach an accommodation with the IMF. I once described the organisation as the personification of the Ghanaian proverb, which says:

Asantrofie anomaa

Wofa no a,

Woafa mmusuo;

Wogyae no nso a,

Woagyae sadeἑ !

[Translation: The Asantrofie bird is a taboo which brings you bad luck if you pick it up but which you can’t leave behind because it is of great value!]

Yep! The Breton Woods institutions, of which the IMF is one, were established after the Second World War, to ram “capitalist values” (surely an oxymoron?!} down the throats of the world. I mean, even a former British Prime Minister, the late Harold Wilson, once likened them to the “gnomes of Zurich!”

Ghana, listen: institutions like the IMF do not do pity. Nor sympathy. Nor learn from the history of the effect of their decisions on millions of “The Wretched Of The Earth”. If we go to them, we must have our eyes fully open. And our mouths tightly shut!

What should we have done in the past two years or so? We should have been laying aside some money to make our economy as self-sufficient as possible. Add value to our exports, and . DO that with DEEDS not WORDS.

We have been saying that we need to add value to our exports for so many years. But do we find our chocolates on the shelves of the shops of the rich countries? These countries still buy raw cocoa from us.

The current CEO of the Cocobod, Mr Boahen, laments that there is a shortage of cocoa in Ghana and the Ivory Coast today. Yet the price paid for cocoa by the chocolate manufactures is still low! Mr Boahen, where have you been? That is the name of the game. You and your Ivorian counterpart must recruit a mole from Hershey!

Yes, years ago, when Ghana’s cocoa industry was threatened with the “swollen shoot” disease, an excellent scheme, “Cocoa Rehabilitation” , was implemented by the Gold Coast Department of Agriculture to pay cocoa farmers to allow diseased cocoa trees to be cut out so that the industry could be saved. It worked: in less than two decades, our cocoa production had increased at least five-fold.

And the price fell disastrously to an unprecedented level!

That was our reward!

By CAMERON DUODU

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