IMF Says Ghana’s Economy Is Stabilising

The International Monetary Fund (IMF) has observed some level of stability in Ghana’s economy a month after approving the country’s application for a US$3 billion bailout.

This was after the IMF staff team led by Stéphane Roudet visited Ghana from June 8 to 15 to discuss macroeconomic developments with key stakeholders.

“IMF staff held meetings with H.E. President Akufo Addo, H.E. Vice President Bawumia, Finance Minister Ofori-Atta, and Bank of Ghana Governor Addison, and their teams, as well as representatives from various government agencies, the Parliament’s Finance Committee, the private sector, and civil society,” a statement from the IMF said.

It indicated that softening inflation, an increase in international reserves, and a less volatile exchange rate attest to the country’s economic stability.

“We also took stock of the authorities’ progress in meeting key commitments under the Fund-supported program. These will be formally assessed in the context of the first review of the Extended Credit Facility arrangement, which is expected to be undertaken in the Autumn.

“In discussing progress on the debt restructuring operations, we reiterated that timely restructuring agreements with creditors are essential to secure the expected benefits of the Fund-supported program.”

Ghana was battered with fiscal and debt vulnerabilities, resulting in a loss of international market access, increasingly constrained domestic financing, decreasing international reserves, Cedi depreciation, rising inflation and plummeting domestic investor confidence before May 17, 2023.

On May 17, the IMF approved Ghana’s application for a bailout.

In a press statement announcing the approval, the IMF said the government’s Post COVID-19 Program for Economic Growth (PC-PEG) contains large and frontloaded fiscal consolidation that will bring public finances to a sustainable path.

On May 19, the Bank of Ghana’s account was credited with the first tranche amounting to $604 million from the IMF.