Ghana develops Exit Strategy to opt out of IMF bailout programme

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GOVERNMENT has developed an exit strategy as it prepares to opt out of International Monetary Fund (IMF) bailout programme.

The strategy will ensure Ghana does not return to the Fund and boost investor confidence in the Ghanaian economy post the Extended Credit Facility programme.
The strategy is to ensure that Ghana does not erode the economic gains chalk so far under the programme and therefore return to the Bretton Wood institution in the immediate near future.
“The reason why is also important to make sure we entrench irreversibility is because of investor concerns about Ghana post IMF programme. As a country we have really changed in terms of who we source our debt from; 10 years before we issued our first Eurobond, over 80 percent of our debt stock were primarily sourced from bilateral…..from other countries, DFIs and place like the World Bank and so forth and so on where we were seen as lower income country”, Charles Adu-Boahen, a Deputy Finance Minister disclosed at Accra based Citi FM programme on Economic Outlook.
According to him, 80 percent of government debts today are commercial, from the capital market, a situation that calls for entrenchment of government programmes in order not to have impact on the economy; exchange rate, interest rate and inflation.
He said on daily basis, the government report or provides records on financial activities or accounts to the World Bank, other institutions and individuals to increase transparency and information sharing.

“It means that we have a totally different interaction now. We are now dealing with more market players who require real time information and we believe that our programmes are entrenched, we are on track and the programmes are not going to derail,” he further assured.
He noted that some of the specific economic policies that will be continued even after the IMF deal ends include ensuring that the fiscal deficit will not be more than 5 per cent of Gross Domestic Product (GDP), continue with zero funding by the Bank of Ghana, strict adherence to the Public Financial Management Act (PFMA) to promote effective public financial management and minimise fiscal rigidities posed by high compensation to public sector workers.
Others are deepening digitisation of revenue collection, formalise the economy by the introduction of the Tax Identification Number and the National Identification System, enforce public procurement Act to promote value for money in public procurement, amongst others.
So far the Bretton Wood institution has injected US$764.1 million into the economy with two more reviews expected to take place. The Fund completed its fifth and six review of the economy last week, paving way for the disbursement of US$191m.
“We have successfully brought the programme back on track and are in a better position to successfully conclude and exit the IMF programme by December 2018,” the Deputy Finance Minister explained.
But Business Finder understands that April 2018 is the likely date for the country to finally exit from the programme.
Last week, an IMF team that visited the country largely expressed satisfaction with the performance of the Ghanaian economy.

Source: Augustine Amoah || The Finder

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