Opinion

IEA slams Ghana’s reliance on Bretton Wood institutions, says it’s unsustainable

The Institute of Economic Affairs (IEA) is urging Ghana to prioritise living within its means to foster sustainable development.

The Director of Research at IEA, Dr. John Kwakye, emphasized that the country’s perpetual dependence on external sources, such as Bretton Woods institutions, is unsustainable.

In a press briefing held on Wednesday, April 3, Dr Kwakye criticized the government’s heavy reliance on foreign aid, including Eurobonds and coco cocoa-syndicated, labeling it a lazy man’s approach.

He urged the government to take immediate steps to curtail expenditure, warning that failure to do so would lead to unsustainable debt levels in the near future.

“The Governor admitted that the foreign exchange market came under some pressure, both seasonal and non-seasonal-in February and early March. He reported that in the year to 20th March, 2024, the Ghana cedi recorded a depreciation of 6.8 percent against the US dollar. He, however, stated that the cedi “continues to recover its value.” But the question is by what measure?”

“Certainly, not in nominal terms because since he spoke on 25th March, the cedi has continued to depreciate, reaching nearly GHS13 to the dollar. Let us repeat right here that relying on funds from the IMF, World Bank, Eurobonds, cocoa syndicated loan, etc. to bolster the cedi, as we have been doing, is not only “a lazy man’s approach,” to say the least, but also clearly unsustainable as the pressure would be back on when the loans fall due for repayment.”

source: myjoyonline

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