Dean of the School of Finance at the University of Cape-Coast, Prof. John Gatsi, has made it known to the government that its angling to run back to the IMF for a bailout is known by Ghanaians and that its move to use the rejection of the e-levy to justify such a move will not be accepted.
In a write-up, Prof. Gatsi says Information Minister, Kojo Oppong Nkrumah’s presentation of the opportunity cost between allowing implementation of the e-levy or going back to the IMF is not a fair proposition to make especially as it creates the impression that Ghanaians will be to blame if the government is forced to return to the IMF.
“…It will be unfair to blame going to the IMF for a program on Ghanaians. Ghanaians are not afraid of an IMF program so there is no need to threaten Ghanaians to accept the e- levy in its current form if not so the government will go to the IMF. Faithfully engage the stakeholders and you will be fine. If you want to go to the IMF go on your own, don’t blame Ghanaians,” Prof. Gatsi wrote.
This apparently is in response to a supposed opportunity cost that faces Ghanaians between accepting the unpopular e-levy of 1.75% on all electronic money transactions, including mobile money transfers and having to return to the IMF for a bailout.
According to Prof. Gatsi, he finds it strange that the government seems to have hedged its economic recovery program on the e-levy.
“The government has put its fiscal destiny on the e-levy such that if the e- levy is not approved then the government will go to the IMF. This is strange because if the levy is expected to yield US$1billion and assuming the levy is not approved, the deficit will widen and the government will have to go to the market to borrow and not an IMF program.”
He pointed out that this is so in spite of the fact that the economy has long been receiving support from the IMF already.
“We already know the economy has been under IMF support until 2019 and resumed non- program support from the IMF from mid-2020, 2021 and again in the disputed 2022 budget.”