Few months ago, the same IMF told us that Ghana’s economic woes could be attributed to external factors including the Russia- Ukraine War as well as COVID-19. This U-turn may sound like a surprise but on a second thought, it also reminds us that our current economic challenge is not so much of external factors.
My first point is, IMF is a respectable institution even though we know that they like diplomatic communications to attract investors while they provide debt-distressed nations with short-term life support for short-term healing.
I want IMF to also understand that in as much as that could be one of their games, they should also try their best to research on local economies and have access to all necessary information concerning a particular domestic economy before they make any official pronouncement.
Today, you are telling us that inflation in Ghana is more domestic-driven instead of imported inflation. This means Russia and Ukraine War as well as COVID-19 could not be the major factors for our current economic situation.
How did the Finance Ministry conclude that our current economic woes were largely influenced by COVID-19 and Russia-Ukraine War?
For the past few days, I have been trying to check the state of affairs in other African countries that were equally affected by external factors (Russia and Ukraine/COVID-19). I used the month of August as my reference month since some countries have not submitted their September inflation rate figures. Remember that Ghana’s inflation as of August was 33.9%.
In my research, I found out that in August Ghana’s inflation could only beat Sudan and Zimbabwe who had inflation rates of 117.4% and 285.40%
To my surprise, Benin had a negative 0.30 inflation rate.
Ghana’s neighbouring countries like Nigeria, Ivory Coast, Togo and Burkina Faso also had 20.52%, 6.2%, 7% and 18.10% inflation rate respectively.
I further tried to understand the economic dynamics of countries that surround the victim i.e Ukraine since direct neighbours need to suffer some level of consequences in as much as a distant neighbor like Ghana has been hit so hard.
Ukraine is bordered by Belarus to the North, Poland, Slovakia and Hungary to the West and Romania and Moldova to the southwest with a coastline along the black sea and the sea of Azov to the south and southeast.
Belarus, Poland, Slovakia, Hungary, Romania and Moldova had inflation rates of 17.9%, 17.2%(sept), 20.10%(highest since Nov 1996) 15.3% and 34.2% respectively.
So from this data, it was clear that Ghana’s inflation as of August(34%) was better than only one of Ukraine’s Neighbours, Moldova(34.2%) with a 0.2 difference.
I went on further to understand why African countries who recently experienced Coup d’état seem to be doing better with their inflation figures even though they have experienced some level of instabilities which should affect investors confidence to an extent yet their inflation figures are better than us. For example, the inflation for Guinea(21.41% July), Burkina Faso(18.2%) and Mali(Feb 8.7…Needs update) all seem to be doing better than Ghana. I know the debate of “France backing” will come in here hmmm!.
This makes me feel that Ghana wants the world to understand that apart from Sudan and Zimbabwe, it was the only country in Africa that suffered an immense impact from the advent of COVID-19 and the Russia-Ukraine War. I want to believe that in the whole of Africa our interventions were unprecedented.
In my next episode, I will consider some of the COVID-19 interventions by other African countries if Ghana really stands tall.
For “fairness”, I will exclude all Francophone countries.
My Humble Opinion
Author-Kwame Offei
