IMF Approves $600m For Ghana

It has emerged that the Government of Ghana has gotten the green light on the term agreement from the Official Creditor Committee, to pave the way for the IMF Executive Board to release the second tranche of the $3 billion extended credit facility of $600 million.

The Minister for Finance, Ken Ofori-Atta, who confirmed the news to Bloomberg said ‘’We are receiving the draft term sheet today so I think we are about done.

“We will look into the details, but then it’s good enough for the IMF to continue with their work, so we’re in good shape.”

Initially, ⁠an agreement in principle is enough for Ghana to go to the IMF Board to seek approval of the 6th October 2023 Staff Level Agreement (SLA) for the first review under the $3 billion ECF program.

The IMF Board approval will, within days, unlock the second disbursement of $600 million.

Meanwhile, the IMF Africa Director, Abebe Selassie in October, lauded Ghana’s remarkable progress and affirmed that Ghana had done its part.

He explained that “I have to tell you that whereas it took something like nine months or more for Zambia to get the official creditor committee to be created, in Ghana’s case, it was fairly rapid, adding that, “Ghana has done its fair share and it’s for the creditors to take steps.”

On the other hand, the IMF’s Resident Representative for Ghana, Leandro Medina, said that discussions between Ghana and official creditors were showing “promising progress.”

‘’IMF Board approval is expected to further “trigger” World Bank Funding to the tune of $550 million. The Bank has pledged $300 million in budgetary support and another $250 million toward Ghana’s Financial Stability Fund.

These funds are all expected before the end of February 2024, with a strong and positive effect expected on Ghana’s reserve position and exchange rate stability’’ a Statement confirmed.

Source: Daniel Bampoe