IMF board approval of the proposed three-year mortgage is predicted early subsequent yr, the finance minister mentioned.
The Worldwide Financial Fund (IMF) has agreed to a $3bn mortgage to Ghana to get the West African nation’s debt beneath management, restore monetary stability and assist individuals most in danger from rising costs and different financial issues.
Ghana is dealing with greater than 40 % inflation, rising debt and a pointy decline in its cedi foreign money for the reason that begin of the yr.
IMF officers have been within the capital Accra this month, the place they mentioned help for the nation’s coverage and reform plans with authorities.
At a information convention on Tuesday, finance minister Ken Ofori-Atta mentioned Ghana was “dedicated to the programme and can work in direction of assembly the calls for”. He mentioned the settlement will assist restore financial stability, deal with value spikes and strengthen the foreign money.
IMF board approval of the proposed three-year mortgage is predicted “early subsequent yr”, Ofori-Atta mentioned.
“We pray that this would be the final [support needed]. That’s the reason the programme might be that sturdy,” he mentioned.
Stephane Roudet, IMF’s mission chief to Ghana, mentioned in a press release on Monday: “The Ghanaian authorities have dedicated to a wide-ranging financial reform programme, which builds on the federal government’s Put up-COVID-19 Programme for Financial Progress (PC-PEG) and tackles the deep challenges dealing with the nation.”
Ghana’s reforms are centered on shoring up public funds whereas defending the weak, he mentioned. The modifications embrace making a medium-term plan to usher in income, growing tax compliance, making the nation’s funds extra clear and enhancing how public industries are dealt with.
Ghana additionally introduced it can restructure its debt and “dedicated to strengthening social security nets, together with reinforcing the prevailing focused cash-transfer programme for weak households and enhancing the protection and effectivity of social spending”, Roudet mentioned.
The aim is to revive financial stability and debt sustainability whereas laying the muse for stronger progress, the IMF mentioned.
IMF managers and board members nonetheless should approve the three-year settlement, which might come beneath a programme offering monetary help to nations with balance-of-payments issues. Ghana’s companions and collectors additionally should acknowledge receiving financing assurances, the IMF assertion mentioned.
Inflation reached greater than 40 % in October, the very best it has been since July 2001 and properly above the central financial institution’s goal of 6 % to 10 %, based on Buying and selling Economics, which offers world financial statistics. Costs accelerated by some 5 % for meals and greater than 10 % for non-food objects, the corporate mentioned.
The IMF says decreasing inflation, boosting market confidence and making it simpler for Ghana to resist exterior shocks had been priorities, with work from the Financial institution of Ghana on financial coverage and trade fee flexibility and the federal government launching a home debt trade.