Fiscal Policies Vs. Central: Ghana protesters demand central bank governor resign ($3 billion, three-year loan programme with the IMF) – October 4, 2023
When you start talking about financial and Economic IQs, you have to start with foundational knowledge and culture. I’ve written about Ghana quite a few times, primarily because it was one of the first African nations to declare Independence.
Unfortunately, a Black American socialist by the name of W. E. B. Du Bois was a part of their “Liberation” process, which in my opinion, turned what could have been a massive success story into a mediocre rise. Ghana, in comparison to other African nations, isn’t doing that bad economically; you can see potential there.
The issue with Ghana is property rights, this is actually the problem with most African nations. Africans do not like the idea of foreigners owning land in Africa; this can even include black foreigners not being allowed to own land in some sub-Saharan African countries.
Very unreliable laws regarding property in Africa lead to places like Ghana, often struggling to find investment. The International Monetary Fund (IMF) works to achieve sustainable growth and prosperity for all of its 190 member countries. as stated on their website, so when you take a loan out from them, you have to make reforms based on their guidelines.
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When you comprehend how the IMF works, you comprehend how money is LITERALLY being printed out of thin air based on Fiscal policy. There is a perception that the IMF has money, when in fact, if you dig deeper, the IMF is selling ideas on how to govern.
A lot of countries find their currencies worthless, and then they simply create or RESET a new fiat currency, sometimes with the blessing of the IMF. What most people fail to comprehend is that energy gravitates to where the best FISCAL policies are.
What I’m getting at is that Ghana, or any of the IMF countries, don’t need the IMF; what they need are better fiscal policies. So when I watch some people of Ghana protesting their central bank, I say to myself they should be protesting their silly socialist policies that are built into their constitution.
Article 24
establishes the economic rights of the Ghanaian citizenry. Clauses 1 and 2 establishes the right to work under satisfactory, safe, healthy conditions, and equal pay with the assurance of days off when requested and on public holidays. Additionally, Article 24 clause 3 grants the right of the Ghanaian citizenry to form or join trade unions for the “promotion and protection of his economic and social interests.”
In COMMUNIST China, they don’t allow trade unions, why? Because trade unions disrupt and often PREVENT economic development, I’m against trade unions in the Western world, but at the very least the western world is already DEVELOPED. Ghana is an undeveloped country; why would opt for the “cherry on top” before you’ve strengthened the economy?
My answer is that W. E. B. Du Bois likely had a lot to do with it; you have to also remember that Ghana’s liberation, also led to the liberation of other nations, many of whom duplicated their SOCIALIST blueprint.
In China, what separated them is that their Communist system, is more like a fascist system, in that everything in China, is basically a State-owned enterprise, you have “Property Rights” in China, but the Chinese Communist Party can strip you of those rights any time it feels like it.
You might argue, well why would any foreigner want to invest in a place like that? Well, because a lot of Western Nations have worse fiscal policies than China. As I’m writing this, the State of New York is trying to strip former President of the United States Donald J. Trump of his PROPERTY RIGHTS in New York.
This actually happens a lot in the United States, but most Americans don’t have the resources to fight back against their bloated government, so this is why for some Americans, China and the Chinese Communist Party don’t seem like such a bad idea to do business.
But you see if Ghana has bad reputation for property rights and the ability to form a trade union is built into their constitution, you can see why they’re struggling with debt.
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Now, I know a lot of people like to blame the central bank because it’s a communist entity that’s an easy target, but the truth a lot of the time, the problem is how the Republic is formed and the culture of the people, which shape the democracy and voting patterns.
In closing, I think Ghana requires serious economic reforms; they’ll need to find a better way to attract capital.
Interesting times ahead
