The International Monetary Fund (IMF) has reached a staff-level agreement with the Government of Ghana for the fourth review of its Extended Credit Facility (ECF) programme.
This agreement paves the way for a disbursement of approximately US$370 million, pending final approval from the IMF Executive Board.
The agreement follows a two-week mission to Accra, led by IMF Mission Chief Stéphane Roudet, and comes amid signs of economic resilience, despite some policy setbacks in the run-up to Ghana’s 2024 general elections.
“IMF staff and the Ghanaian authorities have reached a staff-level agreement on the fourth review of Ghana’s economic programme under the ECF arrangement,” Mr. Roudet stated in a press release on April 15.
“Upon the Executive Board’s approval, Ghana will have access to SDR 267.5 million (approximately US$370 million), bringing the total disbursements under the programme since May 2023 to about US$2.355 billion.”
According to the IMF, Ghana experienced stronger-than-expected economic growth in 2024, largely driven by solid performances in the mining and construction sectors. External conditions also improved, supported by strong gold exports, a rise in remittances, and an unexpected build-up of foreign reserves.
However, these positive outcomes were somewhat offset by a significant deterioration in programme implementation towards the end of 2024. The IMF cited pre-election fiscal slippages, rising inflation, and delays in critical reforms across the fiscal, financial, and energy sectors.
“Preliminary fiscal data show slippages in the lead-up to the 2024 elections, including a significant accumulation of arrears. Inflation also surpassed programme targets. Moreover, several planned reforms and policy actions faced delays,” Mr. Roudet noted.
Despite these setbacks, the IMF acknowledged that Ghana’s new leadership has taken decisive steps to get the programme back on track.
These include the passage of the 2025 national budget, which targets a primary surplus of 1.5% of GDP—marking a turnaround from the previous year’s deficit of over 3%. The government has also introduced several public financial management reforms to control spending and prevent future overruns.
To enhance transparency and oversight, discussions focused on addressing structural weaknesses in procurement and financial systems, as well as strengthening social protection for vulnerable groups affected by inflation.
“The authorities have implemented a 2025 budget targeting a 1.5% primary surplus and introduced key public financial reforms,” Mr. Roudet added.
“This includes a strengthened fiscal responsibility framework and stricter rules to manage public expenditure.”
The IMF also welcomed recent steps by the Bank of Ghana to tighten monetary policy through an increase in the policy rate, viewing this as necessary to combat inflation in tandem with fiscal consolidation efforts.
In the energy sector, the reintroduction of quarterly electricity tariff reviews, along with broader reforms, is expected to reduce the sector’s fiscal burden and prevent the accumulation of new debts.
The mission further assessed progress in structural reforms, especially efforts to enhance governance and efficiency in state-owned enterprises operating in the cocoa, gold, and energy sectors.
On debt restructuring, the IMF praised Ghana’s ongoing efforts to restore debt sustainability. The government has signed a Memorandum of Understanding (MoU) with the Official Creditors Committee under the G20 Common Framework, and bilateral agreements to implement it are in progress.
Meanwhile, talks with commercial creditors continue in accordance with IMF principles on comparability of treatment.
During the visit, the IMF team met with Finance Minister Dr. Cassiel Ato Forson, Bank of Ghana Governor Dr. Maxwell Opoku-Afari, as well as other senior government officials and stakeholders. The team expressed gratitude for Ghana’s “continued open and constructive engagement.”
Source | GBCghana
