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According to Ken Ofori-Atta, Ghana’s finance minister, the second installment of the International Monetary Fund (IMF) bailout cash is expected to arrive in December.
The goal of this assistance is to improve Ghana’s balance of payments in 2023 and 2024.
At the end of June 2023, the country’s balance of payments showed a deficit of $107.8 million, or around 0.1% of GDP, according to the Bank of Ghana’s June 2023 Economic and Financial Stability Report.
Compared to the same time last year, this deficit represented a considerable improvement.
Mr. Ofori-Atta disclosed that Ghana is preparing for its first review with the IMF in November while they wait for the distribution of the second tranche, which totals $600 million, during the third GIPC-CEO breakfast meeting held in Accra.
In order to address the Bank of Ghana’s balance of payment issues, he also stated plans to work with the World Bank to secure a Development Policy Operation (DPO) that would contribute an extra $300 million. This might result in a total injection of roughly $1 billion.
“We are ready for the mission that comes at the end of September so that we can try and get the staff level agreement while the mission is here, and then we go to the board in November for the release of the 2nd tranche, which will be $600 million”, the Finance Minister stated.
“In addition to that, there are certain things we need to do with the World Bank so that we can get our DPO, which will be another $300 million. I believe that we are on course to maybe get a billion dollars to support Bank of Ghana’s balance of payment issues”, he mentioned.
Mr. Ofori-Atta expressed confidence that negotiations with the Paris Club and bilateral creditors will be finished by year’s end.
The IMF provided Ghana with the first $600 million installment of a $3 billion, three-year extended credit facility in May 2023 with the goal of reviving the economy of the nation.
The Bank of Ghana must continue to follow its policy directives notwithstanding the financial challenges it suffered in the previous fiscal year, the IMF emphasized in August 2023.
The IMF emphasized the need for the central bank to move swiftly in order to nudge inflation back toward its 8% objective.
The Bank of Ghana suffered a GHS 60 billion loss as a result of the government’s domestic debt exchange, however the IMF acknowledged this loss and determined that this impairment was required to regain macroeconomic stability and public sustainability.
Source: Ghanatodayonline.com
