IMF reaches staff-level agreement on the 2nd review of the extended credit facility with Ghana

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A staff-level agreement has been achieved between Ghana and the International Monetary Fund (IMF) to wrap up the second review of the 36-month program funded by the ECF.

A third tranche of US$360 million will be released as a result of the deal, if the IMF Executive Board gives its approval.

According to an IMF press statement, the program has performed well overall, with the majority of its quantitative goals accomplished and significant changes put into place.

According to the announcement, “the authorities’ strong policy and efforts have continued to yield positive results: both fiscal and external positions have significantly improved in 2023; economic growth is higher than initially expected; and inflation has continued to decline.”

However, the IMF stated that in order to guarantee the early completion of the review, an agreement on a Memorandum of Understanding (MoU) for a debt treatment, in line with the principle agreement agreed in January 2024, must be obtained by Ghana and its official bilateral creditors.

A team of staff members from the International Monetary Fund (IMF) led by Mr. Stéphane Roudet, Mission Chief for Ghana, met in Accra from April 2–12, 2024, to talk about the authorities’ policy priorities and the status of reforms in relation to the second review of Ghana’s three-year program under the Extended Credit Facility. On May 17, 2023, the IMF Executive Board authorized the arrangement for a total of SDR 2.242 billion (US$ 3 billion).

At the end of the mission, Mr. Roudet issued the following statement:

“I am pleased to announce that IMF staff and the Ghanaian authorities have reached a staff-level agreement on the second review of Ghana’s economic program under the Extended Credit Facility arrangement. This staff-level agreement is subject to IMF Management approval and Executive Board consideration once the necessary financing assurances have been received. An agreement between the Ghanaian authorities and their official creditors on an MoU for a debt treatment in line with program parameters, would provide the needed financing assurances. Upon completion of the Executive Board review, Ghana would have access to SDR 269.1 million (about US$ 360 million), bringing the total IMF financial support disbursed under the arrangement since May 2023 to SDR 1,171.9 million (about US$ 1,560 million).

“Performance under the IMF-supported program has been generally strong, with most quantitative targets met. Good progress has also been made on the key structural reform milestones. The authorities’ policies and reforms to restore macroeconomic stability and debt sustainability while laying the foundations for stronger and more inclusive growth are already generating positive results.

“Economic activity in 2023 was more robust than initially envisaged, and growth projections for 2024 will be revised upward. Monetary policy has remained appropriately tight, allowing for inflation to decline rapidly.

“On the fiscal front, consistent with the authorities’ commitments under the IMF-supported program, the fiscal primary balance on a commitment basis improved by over 4 percentage points of GDP in 2023 and is on track to achieve a fiscal primary surplus of ½ percent of GDP in 2024. Spending has remained within budget limits, while the authorities have significantly expanded social protection programs to help mitigate the impact of the crisis on the most vulnerable. Ghana has met its non-oil revenue mobilization target, while making progress in implementing ambitious structural fiscal reforms to bolster domestic revenues, strengthen public financial and debt management, and enhance transparency.

“The external sector has improved significantly, with international reserve accumulation ahead of program objectives. Financial stability has been preserved, with banks posting solid profits in 2023.

“Given Ghana’s strong progress under the IMF-supported program, the next key step for the country is to reach an agreement with its official bilateral creditors on an MoU consistent with the terms agreed in January 2024. We look forward to the authorities’ continued efforts to reach an agreement with all creditors in line with program parameters.”

IMF staff held meetings with Finance Minister Adam, Bank of Ghana Governor Addison, and their teams, as well as representatives from various government agencies. The IMF team also engaged with other stakeholders. The IMF staff team would like to express their gratitude to the Ghanaian authorities and other counterparts for their continued open and constructive engagement.


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