The planned visit of the International Monetary Fund (IMF) staff to Accra this week, is an important step in tracking the progress of Ghana’s Economic Recovery Programme, which was secured with the IMF on May 17, 2023. The purpose of the visit is not a review of the program but rather to assess the implementation of structural and qualitative reforms and to examine the government’s progress in meeting the end of June targets.
The staff mission visit serves several purposes. Firstly, it allows the IMF to evaluate Ghana’s adherence to the agreed-upon reforms and assess the country’s overall performance. This assessment will contribute to the preparation of the “Target Completion” report, which will track Ghana’s progress before an official program review scheduled for September.
During the visit, the IMF team, led by Mission Chief for Ghana Stephane Roudet, will engage with various stakeholders involved in implementing Ghana’s program. This includes meetings with high-level officials such as the Vice President and the Finance Minister, as well as representatives from the Bank of Ghana. The team will also meet with the Finance Committee of Parliament and other interest groups to ensure all parties are aligned with the program’s goals.
Ghana’s IMF program, approved by the IMF Executive Board on May 17, entails a 36-month Extended Credit Facility (ECF) arrangement of SDR 2.242 billion (about US$3 billion). The immediate disbursement was equivalent to SDR 451.4 million (about US$600 million), with the remaining funds expected to be disbursed in tranches every six months, subject to program reviews approved by the IMF Executive Board.
The decision to apply for the IMF program was driven by Ghana’s severe economic and financial crisis, characterized by an unsustainable debt burden, external shocks like the COVID-19 pandemic and Russia’s war in Ukraine, acute financing pressures, depreciating currency, declining international reserves, slowing economic activity, and high inflation.
The program’s priorities include implementing measures to restore public finances to a sustainable path by increasing domestic revenue mobilization, improving public spending efficiency, and protecting the vulnerable. Ambitious structural reforms are also planned in areas such as tax policy, revenue administration, public financial management, and addressing weaknesses in the energy and cocoa sectors. Efforts to control inflation, preserve financial stability, and encourage private investment, growth, and job creation are also part of the program’s objectives.
Overall, the staff mission visit plays a crucial role in monitoring Ghana’s progress in implementing the Economic Recovery Programme and ensuring alignment with the agreed-upon reforms. It serves as an opportunity for the IMF to engage with stakeholders and assess Ghana’s performance before the official program review in September.
Source: Norvan Reports