Ghana can avoid future International Monetary Fund (IMF) bailouts if the country adopts the gold-backed monetary framework championed by former Vice President Dr Mahamudu Bawumia while maintaining strict fiscal discipline, Tano North MP, Gideon Boako, has said.
According to Dr Boako, Ghana’s recurring resort to IMF programmes is driven by two major vulnerabilities — pressure on the country’s foreign exchange reserves and fiscal indiscipline.
He argued that a monetary system capable of strengthening reserves through gold, combined with strict adherence to fiscal rules, could help Ghana break the cycle of balance-of-payments crises and repeated bailouts.
“If this Bawumia Doctrine of gold-backed stability is followed stricto sensu, it removes the monetary reason for IMF bailout,” Dr Boako said. “What remains is only the fiscal reason — overspending.”
He maintained that the country could build a more resilient economy if it combines stronger reserve accumulation with firm controls on government expenditure.
Dr Boako said the approach must be complemented by “zero tolerance for unbudgeted expenditure” and strict compliance with the Fiscal Responsibility Act.
He noted that fiscal discipline would prevent governments from undermining the gains achieved through stronger reserves and a more stable monetary framework.
“If we combine gold-backed reserves with the fiscal discipline Dr Bawumia has always advocated — zero tolerance for unbudgeted expenditure and strict adherence to the Fiscal Responsibility Act — then yes, Ghana can credibly exit the boom-bust-IMF cycle for good,” he said.
