IMF urges fiscal prudence for election-bound nations including Ghana

The International Monetary Fund (IMF) has advised countries, including Ghana, gearing up for elections in 2024, to prioritize fiscal consolidation to safeguard economic gains and resilience, especially in the face of global uncertainties.

During a press briefing on the Fund's Global Policy Agenda, IMF Managing Director Kristalina Georgieva emphasized the importance of implementing medium-term fiscal prudent measures to counter potential

Read full articledeficits often associated with election years.

Georgieva highlighted findings from the IMF fiscal monitor, indicating that deficits tend to exceed forecasts in election years, posing risks to economic stability. She cited Ghana's expenditure trends, noting a significant increase during past election cycles.

The IMF cautioned against elevated election-related expenditure, urging countries to build fiscal resilience to withstand future shocks. Georgieva emphasized the need for a balanced approach between revenue mobilization and efficient spending, focusing on protecting vulnerable populations.

She advocated for revitalizing growth prospects through governance reforms, reducing bureaucracy, enhancing market participation, and investing in human capital and green transition. Additionally, Georgieva underscored the importance of global coordination on Artificial Intelligence (AI) to harness its potential effectively.

The IMF's fiscal monitor report also recommended governments to phase out crisis-era fiscal policies, enhance revenue potential, and strengthen revenue administration, especially in emerging markets like Ghana.

As nations navigate through economic uncertainties, the IMF remains committed to supporting its members, directing research efforts towards policies that promote growth and fiscal sustainability, Georgieva assured.