By Issah Mohammed, GNA
Accra, May 20, GNA – The Integrated Social Development Centre (ISODEC) has warned that Ghana risks losing economic sovereignty under the International Monetary Fund’s new 36-month Policy Coordination Instrument (PCI).
The Civil Society Organisation said the PCI created a parallel review mechanism whose market signalling function carried more practical authority than Parliamentary debate.
Speaking at a press briefing, Mrs Charlotte Kpogli-Dzadey, Policy Analyst at ISODEC, said the PCI imposed the same “upper credit tranche” conditionality as a regular IMF loan programme, with periodic six-month reviews determining Ghana’s access to international capital markets.
“This is not simply a technical economic matter. It is a governance matter. It is a sovereignty matter. When Ghana’s borrowing capacity and therefore its development financing depends on IMF approval every six months, the centre of gravity for economic decision-making shifts away from Accra and toward Washington,” she said.
Mrs Kpogli-Dzadey said the Government’s fiscal strategy was premised on continued international borrowing as a substitute for domestic fiscal capacity.
“This is the debt treadmill. The IMF does not get Ghana off the treadmill. It manages the treadmill,” she said.
ISODEC also argued that assumptions underpinning IMF frameworks for developing countries, including the view that “fiscal deficits are inherently dangerous” and “government must earn before it can spend”, often resulted in austerity measures such as cuts to public services, wage freezes and subsidy removals.
The organisation said such assumptions could stifle developmental initiatives financed through deficit spending.
“A deficit that builds schools, funds a Job Guarantee programme, or invests in renewable energy infrastructure is categorically different from a deficit that services external debt or subsidises import-dependent consumption,” ISODEC noted.
Mrs Kpogli-Dzadey recommended that Ghana build domestic fiscal capacity through structural transformation policies, including expanding the tax base through formalisation of the economy, plugging leakages from illicit financial flows, investing in productive sectors to reduce import dependency, and deploying targeted public employment programmes.
She urged the country to explore alternative financing options, including the African Export-Import Bank, the African Development Bank’s domestic resource mobilisation windows, Sukuk bonds and South-South development financing partnerships that did not require upper credit tranche conditionality.
Ghana officially concluded its 3-billion-dollar Extended Credit Facility bailout programme with the IMF on May 15, 2026.
Government has, however, opted to engage the IMF under the PCI, a non-financing mechanism intended to provide technical guidance rather than direct financial support.
The Government said it intended to use the arrangement to promote transparency, attract private investment and improve Ghana’s sovereign credit rating.
GNA
Edited by Kenneth Sackey
Reporter: Issah Mohammed, GNAÂ
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