Prof Alexander Bilson Darku
The Institute of Economic Affairs (IEA) has called for the design and implementation of a homegrown national economic programme to help limit the recurrence of financial crises.
The policy think tank indicated that a broad based national development programme will increase the country’s production and export capacity while providing employment to the pool of well-educated youth.
“For 17 times, the country has faced financial challenges that have led to seeking IMF financial bailouts, we shouldn’t have gone there 17 times before now that we are thinking of going with a homegrown plan,” said Ghana Policy Journal (GPJ) editor, IEA, Prof Alexander Bilson Darku.
Speaking at the IEA forum, on the topic, ‘The steps to and out of financial crises in Ghana: Lessons for the future’, he said a nation can only serve itself better if it goes to negotiate for loans with their own development program and policy; short term, medium term, and long term.
He revealed that, successive governments have treated the various financial crises as a temporal problem without any major and permanent macroeconomic and structural policy changes to reform the economy.
“Various attempts by successive government to transform the economy with reforms to improve agricultural productivity and promote industrialization, have left the economy still highly dependent on international financing from bilateral and multilateral institutions, and the international credit sources,” he explained.
“The recent shift from bilateral and multilateral loans with concessional terms, to international credit market funds with market terms, present further international financing challenges such and debt services stress, and future financial crises based on swing of sentiments by private investors in the international capital market,” he lamented.
He therefore advised the country to implement a homegrown national development programme by implementing complete reforms to make the economy resilient to both internal and external shocks.
This he believes will ensure sectoral realignment and interconnectivity to improve productivity and increase government revenue.
“The industrialization strategy must also address the import dependency problem and increase the complexity of exports to earn more foreign exchange,” he added.
By Nafisatu Abdul Razak