NEWS

Ghana gets IMF Board approval for $3billion bailout

Ghana has secured the long awaited $3billion financial support from the International Monetary Fund (IMF) to aid the country’s economic recovery.

This was secured at a meeting yesterday in Washington, when the Executive Board of the IMF unanimously approved Ghana’s programme over the next three years.

It will immediately unlock US$600 million, and provide the critically needed support for Ghana’s balance of payment.

The fund’s backing came after the country, last week, clinched financial assurances from a bilateral-creditors group that’s co-chaired by China and France.

The three-year loan will help replenish Ghana’s foreign-exchange reserves, which have dropped almost 50% from a peak in August 2021 as the Bank of Ghana used them to defend the cedi.

Bailout outcome

Meanwhile, the IMF is expected to hold a press conference to provide journalists with insights into the programme

The press briefing will feature key participants including Stephane Roudet, the IMF Mission Chief for Ghana; Ken Ofori-Atta, Ghana’s Minister of Finance; Ernest Addison, Governor of the Bank of Ghana; and Tatiana Mossot, Senior Communications Officer at the IMF.

Ghana’s Minister of Finance, Ken Ofori-Atta, and Governor Ernest Addison are expected to share insights into the country’s economic challenges, reform efforts, and the potential impact of the Extended Credit Facility Arrangement on Ghana’s financial stability and economic growth prospects.

The IMF Mission Chief for Ghana, Stephane Roudet, will also provide an expert analysis of the country’s economic performance, outlining the conditions and policy measures associated with the Extended Credit Facility Arrangement

Fund Disbursements

The Minister of State for Finance, Mohammed Amin Adam, said earlier this week the government expected to receive its initial disbursement of $600 million this week, and a further $600 million disbursement in November.

The remainder, he indicated, is likely to be disbursed in equal portions of $350 million every six months, subject to IMF reviews.

The government is also in talks for an additional $900 million of budget support from the World Bank over a three-year period, even as it plans to start negotiations with eurobond holders to restructure $13 billion of debt owed to private investors.

Ghana is restructuring its debt under the Group of 20’s so-called Common Framework as part of measures to secure the IMF program. The mechanism seeks to improve coordination between the traditional Paris Club of sovereign creditors and new ones like China, now the biggest lender to emerging nations.

 

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