An Economics Professor at the University of New York has chastised Ghana's donor institutions for interfering in the nation’s economic policies.

Bill Easterly, who singled out the World Bank and the International Monetary Fund for attack, said foreign aid does not guarantee the needed economic growth Ghana so desperately requires.

At an interactive session with visiting students from the University of New York and Graduate Students of the University of Ghana in Accra, the economist said aid donors have a long history of dictating policies to poor countries, which in the long run does not benefit those countries.

"Foreign aid does not help, but hurts poor countries like Ghana,” Easterly insisted.

According to the former World Bank Director, Ghana has little input in how its donor partners mold their economic policies for the country.

He asked, “Where will Ghana’s growth come from over the next ten years?” adding, “the solution is simply not from foreign aid”.

The 50 year old academician opined that home grown solutions are at the centre of the country’s economic progress and prosperity.

He said donor countries must fully recognise Ghana as a truly independent African state, which must be allowed to formulate its own policies and, perhaps most importantly, allow Ghana to “make its own mistakes and learn from those mistakes”.

According to him, home grown policies combined with a dynamic private sector has helped many countries experience sound economic progress.

But the World Bank fiercely rejects notions that it is dictating policy to Ghana. Country Director Mats Karlson maintains there are no conditions attached to World Bank aid.

Pointing at Easterly, Mr Karlson said “you are profoundly mistaken to think that conditions exist in the development programmes of the bank”.

According to him, the bank actually encourages nation-constructed policy options and says the bank debates development projects using successes elsewhere as a basis for constructive arguments.

“Conditionalities do not exist in our negotiations with governments or any of our partners. We encourage policy debates on our programmes,” he says.

He was confident that Ghana will achieve the Millennium Development Goals ahead of time due to its judicious use of resources.

Mr Karlson said “Middle Status is within reach for this country if it uses its finances for productive  purposes”.

He stressed that donors are not the ones calling the shots for Ghana and that if Ghana reaches the middle income status, it would have achieved it on its own steam.

“Foreign aid alone does not make the difference, but well used aid makes the difference” he added.

Former Finance Minister Yaw Osafo Maafo concurred that   Ghana has made strong cases in it negotiations with the World Bank.

He cited instances where he refused to approve the sale of Ghana Commercial Bank to a strategic investor, insisting rather on the sale of government shares through the Ghana Stock Exchange.

He said this was in spite of pressure from the World Bank and other multilateral agencies.

According to him, the investor had proposed plans to reduce the 130 branches of the Ghana Commercial bank to 27, a proposal Mr Maafo disagreed with, arguing that it will limit financial intermediation, especially in the rural areas where the bank is making the highest impact.