The flagbearer of the National Democratic Congress (NDC) John Mahama has pledged to renegotiate the terms of an International Monetary Fund (IMF) bailout and enhance local ownership of future oil and mining ventures if he wins the upcoming December election.
Mahama, who served as president from 2012 to 2016, aims to address Ghana’s economic crisis, which has dented the popularity of the ruling government.
“I’ve been in an IMF programme before, when I was president, and I know that the IMF is not averse to sitting and talking and renegotiating issues,” Mahama, 65, told Reuters in an interview.
Ghana, a major producer of oil, gold, and cocoa, defaulted on most of its $30bn external debt in 2022. The economic strain from years of excessive borrowing was compounded by the COVID-19 pandemic, the war in Ukraine, and rising global interest rates.
In response, the country secured a $3bn IMF bailout in May 2023 and later reached agreements with bilateral and commercial creditors to restructure its debts, halting repayments until 2025.
The IMF has disbursed $1.56bn, with an additional $360mn expected by December. Mahama stated his intent to seek further IMF funds to help Ghana resume debt repayments. He also proposed amending public finance management laws to enforce a compulsory debt-to-GDP ceiling of 60-70% to curb excessive borrowing.
Moreover, Mahama pledged to respect existing production contracts with oil and mining companies and avoid increasing taxes. Instead, he plans to secure higher royalties from future projects.
“I think we are at the upper range of taxes on profit… But I do think that in some cases the level at which we locked in the royalties is low,” he said. He also suggested that higher government stakes in future projects could be achieved via the Minerals Income and Investment Fund, a sovereign wealth facility.
Mahama, who initially became president in 2012 following the death of John Evans Atta-Mills, won his own mandate later that year but lost subsequent elections in 2016 and 2020 to Nana Akufo-Addo of the New Patriotic Party (NPP). As Akufo-Addo steps down after reaching the maximum two terms, Mahama will face Vice President Mahamudu Bawumia in the December 7 polls.
Source: Daily Mail GH
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