After the IMF bailout: The political test facing Mahama's government

For three years, Ghana's economic survival was closely tied to the conditions of an International Monetary Fund (IMF) rescue programme.

The $3bn Extended Credit Facility helped the country stabilise its finances after its worst economic crisis in decades, with soaring inflation, a weakened currency and mounting public debt putting severe pressure on households and businesses.

Now the bailout has ended.

But for President John Mahama's government, the most difficult phase may just be beginning.

The question facing the administration is no longer whether Ghana can secure IMF support. It is whether the economic improvements recorded under the programme can translate into relief for ordinary citizens.

For many Ghanaians, the success of the recovery will not be measured by IMF reviews, credit ratings or government statistics.

It will be judged by simpler questions:

Are prices falling? Are jobs improving? Is life becoming more affordable?

From economic rescue to political accountability

The IMF Executive Board has approved the final review of Ghana's Extended Credit Facility programme, releasing a final disbursement of about $371m and marking the completion of the three-year arrangement launched in May 2023.

The programme was introduced after Ghana defaulted on parts of its debt obligations and sought international support to restore economic stability.

Since then, inflation has fallen significantly from its crisis-era highs, the cedi has shown periods of stability and Ghana has made progress with debt restructuring.

The government is presenting these developments as evidence that the economy is recovering.

But economic recovery on paper does not always translate into immediate political gains.

For voters dealing with the cost of food, transport, rent and utility bills, the question is whether improvements in national indicators are reaching household budgets.

The cost-of-living challenge

The cost of living remains one of the biggest political pressures facing the government.

Although inflation has declined, prices remain higher than they were before the economic crisis.

Many households are still adjusting to increased costs for essential goods and services. Transport operators have continued to raise concerns about fuel prices and vehicle maintenance costs, while businesses say high operating expenses remain a challenge.

The government has argued that restoring economic stability is the first step before stronger growth and job creation can follow.

But analysts say the political challenge is managing public expectations after years of economic hardship.

The post-IMF test

The IMF's exit does not mean the end of economic reforms.

Instead, Ghana will move to a 36-month Policy Coordination Instrument, a non-financing arrangement designed to help maintain reforms and reassure investors.

The Fund has urged Ghana to continue focusing on:

• stronger domestic revenue mobilisation;

• completing debt restructuring;

• protecting the independence of the Bank of Ghana;

• reforming state-owned enterprises;

• strengthening financial sector stability;

• expanding social protection.

For President Mahama, these reforms will require balancing economic discipline with political promises.

The government must maintain investor confidence while responding to public demands for faster improvements in living standards.

The jobs question

Employment is likely to be one of the government's biggest political tests.

Ghana has a young population, with thousands of young people entering the labour market each year.

During the 2024 election campaign, job creation and economic opportunities were central issues.

The government's proposed 24-hour economy policy is intended to expand economic activity and create jobs, but voters will be watching how quickly such initiatives produce tangible results.

For many young Ghanaians, economic recovery will be meaningful only if it creates opportunities beyond survival.

Can economic gains become political support?

Governments often face a difficult period after economic crises: stabilising the economy can require unpopular decisions, while voters expect immediate improvements.

The Mahama administration must now convince citizens that the sacrifices made during the crisis were necessary and that the benefits of recovery are beginning to arrive.

The opposition is likely to focus on the gap between economic statistics and daily experiences, questioning whether government claims of recovery match the realities faced by households.

The road to 2028 begins now

Although Ghana's next general election is still more than two years away, economic performance will shape the political environment.

The government will be judged not only on whether it avoided another crisis but whether it delivered improvements people can feel.

The IMF bailout provided Ghana with financial support and a reform framework.

The next test for President Mahama is political: turning economic stability into public confidence.

For many Ghanaians, the measure of success will not be the completion of an IMF programme.

It will be whether life becomes easier after it.