Former Ghanaian President John Dramani Mahama has announced plans to renegotiate the terms of Ghana’s IMF bailout and increase local ownership in future oil and mining projects if he secures another term in office this December. Mahama, who served as president from 2012 to 2016, will challenge the ruling party’s candidate, Vice President Mahamadu Bawumia, in the upcoming elections.
Mahama, 65, emphasised his previous experience with the IMF during his presidency. ‘I’ve been in an IMF programme before, and I know that the IMF is open to discussions and renegotiations,’ he stated in an interview with Reuters.
Ghana defaulted on most of its $30bn external debt in 2022, a crisis worsened by the Covid-19 pandemic, the war in Ukraine, and rising global interest rates. The nation secured a $3bn IMF bailout in May 2023 and has since reached agreements with bilateral and commercial creditors to restructure its debts and pause repayments until 2025.
With the IMF having already disbursed $1.56bn and another $360 million expected by December, Mahama aims to seek additional funds to help Ghana manage its debt repayments. He also plans to amend public finance management laws to introduce a mandatory debt-to-GDP ceiling of 60-70 percent to curb excessive borrowing.
Mahama assured that he would honour existing production contracts with oil and mining companies and not impose new taxes. Instead, he would seek higher royalties from future projects. ‘We are at the upper range of taxes on profit… But I do think that in some cases the level at which we locked in the royalties is low,’ he noted.
He also suggested increasing government stakes in future projects through the Minerals Income and Investment Fund, a sovereign wealth facility.
Mahama’s campaign is set against the backdrop of significant economic challenges in Ghana. As vice president in 2012, he ascended to the presidency following the death of John Evans Atta-Mills and won his own mandate in the subsequent election. However, he lost the 2016 and 2020 elections to Nana Akufo-Addo of the New Patriotic Party (NPP), who is ineligible for re-election this year after serving two terms.
During his tenure, Mahama faced criticism over power shortages, economic instability, and allegations of corruption, although he was not personally implicated. Critics argue that these issues have persisted or worsened under Akufo-Addo’s administration.
Both Mahama and Bawumia hail from northern Ghana, a region traditionally dominated by Mahama’s National Democratic Congress (NDC) but where the NPP has recently gained ground.
‘We, the youth, are hopeless. We don’t have jobs. How to eat, pay bills, and feed our families is very hard,’ Abdul-Wakil Neindow, 30, who lost his construction job in 2017, told Reuters at Mahama’s campaign launch.
Ghana is known for its stable democracy and peaceful transfers of power, with no party winning more than two consecutive terms. However, the last election was marred by accusations of government interference, which the administration denied.
At his campaign launch, Mahama urged supporters to remain vigilant after voting to prevent any potential vote-rigging.
As Ghanaians prepare to head to the polls in December, the outcome of this election will significantly impact the country’s economic direction and governance.
