John Mahama's Strategic Bid for Ghana's Economic Stability

Former President John Dramani Mahama aims to renegotiate an IMF bailout and increase local stakes in oil and mining projects if re-elected in December. Facing Vice President Bawumia, Mahama plans to secure additional IMF funds, cap debt, and boost royalties while ensuring job creation for Ghana's youth amid a severe economic crisis.

Former Ghanaian president John Dramani Mahama has pledged to renegotiate the terms of an International Monetary Fund (IMF) bailout and enhance local ownership of future oil and mining projects if elected for a new term in December, Reuters reports.

Mahama, who served as president from 2012-16, is set to challenge the ruling party's candidate, Vice President Mahamadu Bawumia. Given the current economic crisis, Mahama has a promising chance of winning. In an interview, Mahama stated, 'I've been in an IMF programme before, when I was president, and I know that the IMF is not averse to sitting and talking and renegotiating issues.'

Ghana defaulted on a significant portion of its $30 billion external debt in 2022, exacerbated by the COVID-19 pandemic, the Ukraine war, and rising global interest rates. The country secured a $3 billion IMF bailout in May 2023 and recently reached deals to restructure its debts and pause repayments until 2025. Mahama intends to seek additional IMF funds and introduce a compulsory debt-to-GDP ceiling to curtail excessive borrowing.

Mahama respects existing production contracts with oil and mining companies and will not seek to raise taxes but aims to increase royalties from future projects. He also envisions higher government stakes in upcoming projects through the Minerals Income and Investment Fund. Mahama invested extensively in infrastructure during his presidency but faced criticism over power shortages, macroeconomic instability, and corruption allegations. However, critics argue that these issues have worsened under President Akufo-Addo's administration.

With youth unemployment on the rise, Mahama's campaign highlights job creation as a priority. Ghana remains one of Africa's stable democracies, and Mahama urged supporters to be vigilant to prevent vote-rigging in the upcoming election.

(With inputs from agencies.)