Ghana has not been readmitted into the Highly Indebted Poor Countries (HIPC) initiative, which it exited about 16 years ago, the International Monetary Fund (IMF) has said.
In consequence, the IMF said, a recent update of Ghana’s debt-to-GDP ratio has not triggered any decision or action by the IMF.
The declaration by Albert Touna-Mama, the IMF’s resident representative to Ghana, follows reports in the media this week that Ghana has been declared HIPC.
In an email to Graphic Online, Dr Touna-Mama said recent publications that Ghana had been added to a list of HIPC countries are false, flawed and misleading.
His email followed reports in mainstream and social media that increased borrowing and rising debt service costs have relegated Ghana to HIPC status.
In the email, Dr Touna-Mama said: “We have been made aware of [social] media reports stating that Ghana has recently been added to the list of HIPC by the IMF.
“The HIPC Initiative is essentially closed for countries that have already reached the completion point,” he said.
He recalled that the country successfully reached the completion point of the programme, introduced in 1996, in July 2004 and is therefore ineligible for readmission to it.
He stressed, however, that the list of countries that have qualified to be part of the HIPC initiative since its inception is “regularly updated on the Fund’s website and must not be interpreted as a new ‘HIPC list’. Any such interpretation is flawed and may be deceptive,” he said.
He added that the recent update of Ghana’s debt-to-gross domestic product ratio has not triggered any decision or action by the IMF.
He referred the general public to the latest edition of the Fund’s Regional Economic Outlook (REO) for sub-Saharan Africa, which he said contains information on Ghana.
Dr Touna Mama encouraged the public to seek clarification before “giving credence to rumour involving the IMF in Ghana”.
“We reserve the right to issue a public statement to make such clarifications as needed,” he said.
Launched by the IMF and the World Bank Group in 1996, the HIPC initiative aims to ensure that no poor country faces a debt burden it cannot manage.
On its website the IMF says that since the launch of the HIPC programme, the international financial community, including multilateral organisations and governments, have worked together to lower to sustainable levels the external debt burdens of the most heavily indebted poor countries.
Ghana joined the landmark initiative in February 2002 and after about two years of working with the Bretton Woods institutions and the African Development Bank (AfDB) to implement it, roughly US$3.7 billion of the country’s debts were forgiven.
The country also benefited from other debt reliefs and economic opportunities from some of its creditors as a result of opting to be declared HIPC.