Can Mahama and IMF agree on spending?

Can Mahama and IMF agree on spending?

Ghana's John Mahama was elected last weekend on pledges to boost spending and ease the cost of living, but faces a tough task squaring his priorities with the $3bn IMF programme.?

Mahama would like to expand credit for SMEs; halt the imposition of VAT on food and petrol; and boost investment in education, health, and infrastructure. As recently as November, he mooted a potential renegotiation of the IMF deal. That would mark a major break from his predecessor. Nevertheless, S&P Global Ratings expects a “smooth transition and policy continuity". "Given the constraints on accessing commercial financing, and a preference for both a stable exchange rate and additional build-up in foreign reserves, the incoming administration appears committed to maintaining tight fiscal and monetary policies, while putting its own stamp on specific government spending programs.”?

The next few years will offer a test of whether the IMF and a Ghanaian government keen to spend can work things out. >> Read more

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