IMF for Ghana: We are working to get the third tranche approved by the end of this month – MyJoyOnline

The International Monetary Fund (IMF) says Ghana is likely to receive its third tranche of $360 million by the end of this month as the country struggles to manage falling yields, which have failed to cope with the strengthening US dollar.

In the latest press conference on June 6, the IMF has indicated that its goal is to help Ghana obtain Board approval for the release of $360 million by the end of this month. This was announced by Julie Kozack, Director of Communications of the Funds.

“Our goal is to bring the review to the IMF’s Executive Board for approval before the end of June. This would give Ghana access to $360 million in financing, bringing the total to about $1.6 billion in disbursements as of May 2023 ,” she pointed out.

According to the Fund, “Ghana’s strong policy and reform efforts under the three-year program are bearing fruit and signs of economic stabilization are emerging. For example, growth in 2023 was higher than we had originally forecast.”

The IMF also indicated that the authorities are also making good progress in their comprehensive debt restructuring. “The domestic debt swap was completed last year and in January 2024 the government reached an agreement in principle with its official bilateral creditors. Ghana is also engaging its external private creditors to seek their support,” the Fund noted.

Looking ahead

Ghana is currently starving for dollars! After reaching an IMF staff-level agreement almost two months ago, the country has yet to meet all the requirements needed to unlock the third tranche of its IMF loan, although people familiar with the workings of debt restructuring talks say negotiations and agreements are getting closer. in the final stages at the bilateral level.

As a result, the current tightening of monetary policy that is continuing in the US plus Ghana’s ever-increasing import bill has put a lot of pressure on the cedi, which has lost more than 20% of its value against the US greenback since the beginning of the year. .

Looking ahead, the IMF believes that “sustainable implementation of policies and reforms will be crucial to fully and sustainably restore macroeconomic stability and debt sustainability in Ghana” and that “the government is committed to continuing program implementation as envisaged to ensure sustainable growth and support poverty reduction”. .”

Debt Sustainability

New data from the Bank of Ghana shows that the country’s total public debt has reached GHS 658.6 billion, which is almost double the level it was in December 2022 before the implementation of the Domestic Debt Exchange Program (DDEP).

According to the IMF, “in every review, including this one, which is in progress, the IMF provides not only a full update of the economic situation and macroeconomic forecasts, but also debt sustainability analysis. The latest DSA will be published with Staff report as the Board considers the second review of the program And of course, just to reiterate that it is now important that the government continues to make progress, as it has with its creditors, to finally restore debt sustainability for the country.”

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