Each of the countries going to IMF have unique circumstances that have led them to declare the need for help. Ghana is locked up in staggering pension liabilities, expensive labor contracts, huge flagship programs with large expenditures, and at the same time tax revenue that have fallen due to a weak economy and sluggish market and changes in government policies.
For countries in the worst financial situation, the IMF process provides a legal framework to reorganize debts and negotiate an orderly plan to repay creditors. We know IMF can also force the political will necessary for politicians, government officials, and the people of Ghana to make difficult, painful decisions that address deep-rooted fiscal, political, and structural problems, and give us a fresh start.
Unfortunately, during the pre-covid era, officials spent a lot more freely, financed large-scale civic improvement projects and entered into long-term contracts with public sector workers, obligations that could not easily undo when revenue fell.