Managing Director of the International Monetary Fund (IMF), Christine Lagarde, says she expects Ghana’s donor partners to release withheld funds now that the country has signed up to a 3-year programme.
Responding to a question posed Joy Business at the IMF/World Bank Spring meetings in Washington DC, Ms Lagarde said a Fund programme usually has a catalytic effect on countries whose funds have been frozen by donor partners.
“When a country has signed a program, has negotiated the terms and conditions and agreed to what is going to be good for its development, it generally always triggers on the part of other bilateral institutions, of other bilateral lenders, financing that sometimes had been frozen or locked, pending negotiations. So, this is a typical result that we see from program conclusions”, she said.
The country’s donor partners have held up some 500 million dollars because of concerns with the management of Ghana’s economy.
Some of Ghana’s donor partners even proposed that unless government signed up to an IMF program, some of these frozen funds will not be released.
However, Swiss Ambassador to Ghana, Gerhard Brugger, recently told Joy Business that securing an IMF program will not necessarily result in the release of frozen donor funds.
According to Mr Burgger, the release of development donations from his country, for instance, will depend on whether Ghana’s economy has met key targets set for it.
Ghana is expected to get about 1.5 billion dollars in addition to the 918 million secured under an IMF program.
For some economists, these donor funds are critical because its release will stabilise the economy and the Ghana cedi which has been depreciating substantially against the dollar.
