Rebuttal IMF responds to Minority over legality of Ghana's bailout

“As a general rule we do not comment on domestic legislative processes.

  • Published:
IMF boss, Christian Largarde play

IMF boss, Christian Largarde

24/7 Live - Subscribe to the Pulse Newsletter!

The International Monetary Fund (IMF) says it will not interfere in the controversy over whether the country’s deal with the fund required parliamentary approval.

“As a general rule we do not comment on domestic legislative processes. In a similar vein, it is a matter of domestic law as to whether an IMF arrangement requires parliamentary approval, and we defer to the member authorities to make this determination,” the fund said in response to an email from Joy FM.

The Minority in Parliament last Tuesday accused President John Dramani Mahama of violating the 1992 Constitution by failing to seek parliamentary approval for the three-year Extended Credit Facility (ECF) agreement between the government and the IMF.

The Minority’s case

At a press conference in Accra, it called on the President to take immediate corrective measures and cause the Speaker of Parliament, Mr Edward Doe Adjaho, to recall the House from recess to approve or reject the loan agreement.

It warned that if by the end of September this year President Mahama had failed to heed the call, it would use all avenues, including a court action, to ensure that “the sanctity of the Constitution is protected”.

The Member of Parliament (MP) for Effutu, Mr Alex Afenyo-Markin, who was one of the MPs who put the Minority’s case across, also called on the IMF to cease further disbursement of the ECF until Parliament had approved it.

“In fact, we are surprised that the IMF, with all its experience in the surveillance of its programmes, will condone such an egregious act by the government of Ghana,” he said.

IMF’s say

But in the email response, the IMF said: “The Ghanaian authorities issued a press release today (September 10) confirming that, under Ghanaian law, no such parliamentary approval is required.

“The government statement indicated that the ECF loan is disbursed directly to the Bank of Ghana (BoG) as balance of payments support and is used accordingly by the BoG, without supervision or interference by the Minister of Finance or any other governmental authority. It, therefore, does not constitute government borrowing and would not require parliamentary approval.

“Let me also remind you that as a member of the IMF, Ghana requested for a programme that was then approved by the IMF Executive Board in April 2015. This approval and the related disbursements since then have been done in accordance with the Fund’s own rules, including the emphasis on a member’s commitment to implement the programme.

“Ghana’s three-year ECF-supported programme is anchored on the country’s very own Shared Growth and Development,” the email reportedly said.

The government’s position

The Ministry of Finance has explained that Ghana’s three-year extended credit facility, (ECF) programme with the IMF, does not constitute government borrowing that requires parliamentary approval.

It said the loan, which was approved by the IMF Board based on a letter of intent signed by the Minister of Finance and the Governor of the BoG, was disbursed directly to the bank as balance of payment support.

The facility, according to a Deputy Minister of Finance, Mr Cassiel Ato Forson, would be used accordingly by the bank without supervision or interference by the Minister of Finance or any other governmental authority.

Mr Forson was reacting to the statement by the Minority in Parliament on the illegality of Ghana’s programme with the IMF due to the lack of a parliamentary approval.

In an interview with the Daily Graphic, he explained that the minister signed the letter of intent together with the Governor of the BoG because some of the policies underpinning IMF programmes were policies to be implemented by the government.

“The IMF loan to the BoG does not constitute government borrowing within the ambit of Article 181 of the Constitution. The borrowing would, therefore, not require parliamentary approval,” he said.

No approval required

Mr Forson said under Article 181 of the Constitution, loans that were supposed to receive parliamentary approval were those that would be serviced out of the Consolidated Fund or any other public fund.

“It is worth noting that the IMF loan to the BoG is not part of government debt.

He said the Minority in Parliament did not understand the IMF programme, thus their statement was born out of ignorance.

Do you ever witness news or have a story that should be featured on Pulse Ghana?
Submit your stories, pictures and videos to us now via WhatsApp: +233507713497, Social Media @pulseghana: #PulseEyewitness & DM or Email:

Recommended Articles

Recommended Videos

Top Articles

1 Poverty Gap Ghana’s policies make the rich wealthier – UNbullet
2 Job Creation Nation Builders Corps to be launched end of April - Bawumiabullet
3 Menzgold Ghana Don't deposit money with Menzgold – BoG cautions...bullet
4 Menzgold Ghana Investment company closes down its Gold Vault Marketbullet
5 Salaries In 2018 Here are the dates public workers will be paid...bullet
6 SSNIT Scandal 10 SSNIT staff with fake certificates dismissed...bullet
7 NPP government Ghana Beyond Aid is fight for economic...bullet
8 In Upper East 2 men killed in daylight bank robberybullet
9 Retirement How to calculate your SSNIT pensionbullet
10 $100K Saga Presidency denies having knowledge of...bullet

Top Videos

1 Forbes 2018 Africa's billionaires rich listbullet
2 Dr Joseph Siaw Agyepong Nobody can collapse my company – JOSPONGbullet
3 Money Alert Meet Africa's richest womanbullet
4 New Discovery Ghana discovers new mineral, lithium in commercial...bullet
5 Support Finance minister buys Kantanka carbullet
6 Plane Crash Starbow suspends operations following plane crashbullet