Ghana: Mortgaged to the Hilt

First this (shared with me by a good friend): "An Analysis of the IMF Conditionalities For Ghana.

My View on the Conditionalities
These are measures that may impose some hardships that ideally should be endured, with the understanding that we must all sacrifice in order to turn things around. They are measures that we could have implemented ourselves without receiving them as orders from the IMF. A sovereign nation headed by a regime that touts its credentials of having the men should have known and implemented these interventions without waiting for the IMF to tell us what to do.

I have a few concerns which I raise as questions. Was this a truly well-negotiated IMF deal? Does the IMF truly know what is going on in Ghana, particularly on matters of corruption? I ask this because, in Ghana, we are always caught in the quagmire of fetching water with a basket. Yet, nothing substantial was said to help us check the leakages and slippages. Indeed, in the fight against corruption, the talk about the continuous implementation of a National Anti-Corruption Action Plan (NACAP) that exists merely in name by the document, shows that the IMF perhaps is no longer a serious institution. This is because it doesn't appear there will ever be serious efforts at implementing the NACAP and an IMF that does not know this is bogus.

In all honesty, it appears the IMF of yesteryears, is no longer the IMF we see today. They are no longer bold; they are no longer courageous; and they seem to be tacitly perpetuating a cycle of African dependence on the West. Otherwise, how and why were very low-hanging serious recommendations that would help us quickly turn things around, overlooked? Is the IMF ignorant that we earn just about only five percent of royalties from our gold? Is the IMF not aware that we produce oil and yet earn only just about 13 percent of the oil revenues? Why didn't they talk about we taxing the extractive sector adequately to raise more revenue for ourselves? Why were they silent on what we must do to stop illicit financial flows? Do they come from countries whose sizes of government are as bloated as ours? Were they coerced to keep quiet about the local and international calls on our government to downsize?

To my mind, any IMF Conditionality that is unable to answer the questions posed above is a mere propaganda that seeks to inflict hardships on the poor; make Africans dependent on the West; and cover up for leadership incompetence and unwillingness to sacrifice.

Let the government be warned that Labor would resist any unnecessary imposition of hardships on poor people without a palpable show of sacrifice on the part of political leadership.

The IMF must know that the Ghanaian is intelligent enough to know when a cycle of dependence is being perpetuated and we will soon resist. If the IMF truly wants to help us, then they must be bold in telling us nothing but the truth so we can wiggle ourselves out of imposed and our self-inflicted hardships. An IMF that fails to do this will deepen the derogatory, (but sometimes deserving) PERCEPTION that reduces it to a spineless organization, staffed by cowards, praise singers, and fun-fool respecters of failed African leaders.

Yaw Gyampo & co.
**** Femi Akomolafe's comments: Albert Einstein defined insanity as doing the same thing over and over and yet expecting to get a different result.

If we keep asking the wrong questions, it's obvious that we will keep on getting the wrong answers.

Some pertinent questions we refuse to ask ourselves:

1. Where have IMF policies transformed any economy beyond the dependency state?

2. Was the IMF set up to help with economic development or to perpetuate neocolonial dependency?

Any sane person would ask how US$3 billion from the IMF will magically transform an economy that is tottering under a US$30 billion external debt!

It's sad we continue to naively believe that international relations are based on altruism and Christian Charity, hence our penchant to keep on looking for manna from foreign Father Christmas.

The Chinese and the Russians who have successfully transformed their economies in recent years did so without help or dictation from the IMF.

And, perhaps the Mother of All Questions: Were the brilliant economists of the IMF so capable, why are all Western Economies presently struggling?

The mighty USA, the home of the IMF gurus, is currently tottering on currency default! Its gargantuan debt is mathematically unpayable!

Then this:
"The International Monetary Fund (IMF), has revealed details about how Ghana's four collateralized loans from China have exposed the country to the possibility of losing parts of its mineral resource revenue in addition to electricity sales in the future.

For Ghana, Chinese loans have been a reliable funding source for major projects since the year 2000. In two decades, Accra has racked up close to $5 billion from at least 41 Chinese loans.

After several years of near-unbridled borrowing, Ghana is now debt-trapped and wading through its worst economic crisis in a generation, with a current external debt portfolio exceeding $30 billion...

.....
According to the Fund, Ghana's collateralized debt as of the end of 2022, was entirely held by China, this corresponds to four loan agreements signed in 2007-18 that amount to US$619 million to finance infrastructure projects. These loans are collateralized against commodity production (cocoa, bauxite, and oil) and electricity sales.

"Collateralized debt is any contracted or guaranteed debt that gives the creditor the rights over an asset or revenue stream that would allow it, if the borrower defaults on its payment obligations, to rely on the asset or revenue stream to secure repayment of the debt" the IMF stated.

Source: https://www.myjoyonline.com/china-has-access-to-ghanas-mineral-revenue-and-electricity-sales-upon-default-of-4-loans-imf/

Femi's comments: It is not anger but huge sadness I felt as I read this article!

I was among the Africans who campaigned for debt cancellation for Africa as we entered the new millennium.

I used my columns in both the New African magazine and the Daily Dispatch to write angry polemics against the crippling debt that was suffocating the world's poorest continent.

Our efforts appeared to have yielded some efforts as the debts were largely written off!

Little did I know that I was just wasting my time!

A few years down the road, our incorrigibly corrupt and reprobate elite, with an unbridled appetite for unproductive but wanton lifestyles, have sent their countries back into huge indebtedness with little to show for it

The question any sane person will ask is how a country like Ghana will sell Gold, Bauxite, and Cocoa among other things, received gifts and grants from far and wide, accumulating a $30+ external debt, yet cannot provide either a stable electricity supply or treated water for its citizens!

These are two articles I wrote a few years ago to lament our waywardness, our inability to plan for the morrow, and our absolute lack of patriotism!

Ghana: Mortgaged to the Hilt

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