Ghana receives conditional IMF permission for $3 billion in economic assistance.
A tentative deal between Ghana and the International Monetary Fund (IMF) calls for the IMF to provide the country with a US$3 billion loan to assist revive the economy and address monetary and fiscal imbalances.
The IMF staff this week accepted the proposed three-year extended credit facility (ECF), subject to final approval by the management and Executive Board of the Bretton Woods institution.
According to a statement from the IMF, management and executive board approval was contingent to the successful conclusion of a debt restructuring operation to reduce the debt stock to levels that could be sustained.
Ghana joined the Bretton Woods institution in 1957, making this the 17th help it has received from it.
The preliminary clearance would be presented to the IMF Board for final approval after the government has made sufficient progress with efforts to restore debt sustainability, according to a statement released by the IMF Mission Chief to Ghana.
"The authorities have announced a thorough debt restructuring to help achieve the goal of restoring national financial sustainability. Sufficient assurances and progress on this front will be needed before the proposed Fund-supported programme can be presented to the IMF Executive Board for approval," the statement said.
A determination that Ghana's debt was unsustainable led to measures to restructure the stock in order to better qualify for the fund support.
On December 5, 2022, a domestic debt exchange scheme was established to exchange four new bonds with maturities ranging from 2027 to 2037 for GHc137 billion in locally issued cedi bonds.
The foreign component will soon be restructured, according to Finance Minister Ken Ofori-Atta.
According to the IMF statement, a successful support programme would be frontloaded with special attention paid to safeguarding social spending and the underprivileged.
On July 1, 2022, Ghana requested a programme from the IMF, citing fiscal and monetary imbalances brought on by the COVID pandemic and the Russia/Ukraine war.