The International Monetary Fund (IMF) has lauded Ghana’s progress under its US$3 billion Extended Credit Facility (ECF), approving a fresh disbursement of US$360 million.
This comes after the successful completion of the third review of the 36-month programme, bringing total disbursements to US$1.9 billion since the programme’s approval in May 2023.
In a statement following the Executive Board meeting, IMF Deputy Managing Director Bo Li praised the country’s economic reforms.
“Ghana’s performance under its ECF-supported reform programme has been generally satisfactory. The authorities’ economic strategy is delivering on its objectives, with the economy showing clear signs of stabilisation,” he said.
The IMF highlighted Ghana’s efforts to navigate the economic crisis of 2022, citing macroeconomic policy adjustments and comprehensive reforms as pivotal to restoring fiscal stability and debt sustainability.
These reforms have spurred economic recovery, a decline in inflation, and improvements in fiscal and external positions.
“The programme has provided a credible anchor for the government to implement reforms that are delivering results,” the IMF noted, adding that the medium-term outlook is favourable despite risks related to elections and energy sector challenges.
According to the statement, Ghana has achieved notable progress in restructuring its public debt.
After successfully restructuring domestic debt in 2023, the government completed an exchange of Eurobonds aligned with programme parameters. It has also intensified engagements with external commercial creditors.
“Building on the recent successful Eurobond exchange, the authorities should finalise their comprehensive debt restructuring in a timely manner,” Bo Li urged.
Ghana’s fiscal consolidation efforts remain on track, with a projected primary surplus of 0.5% of GDP in 2024 and a target of 1.5% in 2025.
The government plans to achieve these goals through enhanced domestic revenue mobilisation, rationalised expenditures, and expanded social programmes.
“Staying the course of fiscal policy adjustment—including before and after the upcoming elections—is paramount to put public finances on a sustainable path and reduce financing needs while cushioning the vulnerable from the impact of fiscal adjustment,” Bo Li emphasised.
The Bank of Ghana (BoG) has also maintained a tight monetary policy to curb inflation and rebuild international reserves.
Efforts to recapitalise state-owned banks and enhance financial sector stability are ongoing.
The IMF underscored the importance of sustaining reforms to address structural vulnerabilities and unlock Ghana’s economic potential.
“Continued progress in improving tax administration, strengthening expenditure control, and tackling energy sector challenges is critical,” the Fund stated.
As Ghana approaches the 2024 elections, the IMF has called for vigilance in fiscal and monetary policy implementation to safeguard economic stability.
Bo Li concluded, “Maintaining a prudent monetary policy stance and enhancing exchange rate flexibility are essential to mitigate inflation risks and ensure macroeconomic stability.”
This latest disbursement from the IMF will support Ghana’s recovery efforts and provide a foundation for sustained growth and poverty reduction.
Reporting by Abigail Teye in Greater Accra
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