The IMF and the World Bank in Ghana in the 1980’s Which solutions to the economic depression?

Abstract

This article sheds light on an important period in the history of Ghana in the 1980’s, when the country was ruled by the Provisional National Defense Council (PNDC) of Jerry John Rawlings. Since 1966, the country witnessed a succession of political upheavals which plunged its economy into a severe crisis. When Rawlings took the reins of power after a military takeover on 31 December 1981, he found no other alternative than the International Monetary Fund (IMF) and the World Bank to get the country from the crisis. These proposed a scheme that required a set of austerity measures of which many in the Ghanaian political class did not approve. The economic reconstruction programme imposed a drastic devaluation of the national currency and a significant curtailment of the state’s role in economy. This inevitably led to a substantial suppression of state subsidy on many necessary items. The situation was hard for Ghanaians but Rawlings finally triumphed to secure the necessary popular support to carry the scheme through, and to greatly stabilize the national economy and save it country from a total collapse.