#INTERNATIONAL_MONETARY_FUND The IMF works to foster global growth and economic stability. It provides policy advice and financing to members in economic difficulties and also works with developing nations to help them achieve macroeconomic stability and reduce poverty. The rationale for this is that private international capital markets function imperfectly and many countries have limited access to financial markets. Such market imperfections, together with balance of payments financing, provide the justification for official financing, without which many countries could only correct large external payment imbalances through measures with adverse effects on both national and international economic prosperity IMF CONDITIONALITIES IMF conditionality is a set of policies or conditions that the IMF requires in exchange for financial resources. The IMF does not require collateral from countries for loans but rather requires the government seeking assistance to correct its macroeconomic imbalances in the form of policy reform. If the conditions are not met, the funds are withheld. Some of the conditions for structural adjustment can include: 1 Cutting expenditures, also known as austerity. 2. Focusing economic output on direct export and resource extraction, 3. Devaluation of currencies, 4. Trade liberalisation, or lifting import and export restrictions, 5 .Increasing the stability of investment (by supplementing foreign direct investment with the opening of domestic stock markets), 6. Balancing budgets and not overspending, 7. Removing price controls and state subsidies, 8. Privatization, or divestiture of all or part of state-owned enterprises, 9. Enhancing the rights of foreign investors vis-a-vis national laws, Improving governance and fighting corruption. --------------------------------------------------------------------------------------------- On the basis of this brief outlook of the IMF, the questions we need to ask John Dramani Mahama are: 1. Do they understand the problems of Ghana very well? 2. Why is he heading to the IMF for support at this time? Why has it taken them all this while for them to take this decision? 3. Were those economic indices they churned out in their Green Book misleading and was deliberately presented to deceive Ghanaians? 4. What happened to his governments decision to adopt home-grown solutions to our challenges (crisis)? 5. Wouldnt the Eurobonds be enough to restructure our economy? 6. How prepared is he for some of the conditionalities of the IMF especially removal of subsidies and trade liberalisation? 7. Has he already accepted to subscribe to the Economic partnership Agreement and how will this affect the IMF Bail-Out decision? 8. Are you ready to lay off some of the public sector workers? 9. You know that fighting corruption and improving governance is a major conditionality of the IMF, how prepared are you to do this? 10.Last but not least, ask your conscience a question and answer it yourself.
Posted on: Sun, 03 Aug 2014 18:08:08 +0000
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