Ghana Finally Gets IMF Board Approval For US$3 Billion Bailout

The International Monetary Fund (IMF) has approved Ghana’s request for a US$3 billion bailout to support the country’s economic recovery, according to people familiar with the matter.

The executive board of the International Monetary Fund met to discuss approval for the funding on Wednesday (17 May).

The country is seeking US$3 billion from the Fund to shore up its battered economy. On Friday, the IMF managing director, Kristalina Georgieva, said Ghana’s official creditors had provided the necessary financing assurances for the IMF executive board to look at signing off the loan.

Earlier, the Minister of State in the Finance Ministry, Mohammed Amin Adam, had hinted that the IMF was likely to approve Ghana’s bailout by Wednesday (17 May).

“We expect a deal on Wednesday. With the disbursement, there is going to be US$600 million as a first tranche just immediately after the approval,” Adam said, speaking by phone, adding that Ghana hoped to receive the funds within a week of the board’s decision.

The inflow will boost Ghana’s coffers and help it work towards the target of foreign reserves amounting to the equivalent of three months’ worth of imports by 2026, the minister said.

Details of the disbursement

According to government, about $600 million would be disbursed to Ghana within a week, once Ghana’s programme is approved by the Executive Board of the IMF.

The second tranche of disbursement would be expected by December 2023.

This is however subject to meeting some conditions under the programme.

The remaining amount will be disbursed in tranches of $360 million every six months, subject to meeting the IMF programme conditions.

Ghana is expecting about $3 billion spread over three years under the IMF Programme.

 

Donor Support for Ghana’s programme

As part of the programme, Ghana will also benefit from other donors to support the country’s economic development.

The World Bank will come on board with the about $900 million to support Ghana’s Budget.

 

Fund to publish details of Ghana’s programme

Meanwhile, the IMF will publish the full details of Ghana’s Economic Recovery Programme once approval is given.

It will also outline the necessary conditions associated with the programme as well as the staff report on Ghana.

Minister of State at the Finance Ministry, Dr. Mohamend Amin Adam told Joy Business government is committed to transparency.

“As a result of this, the government has instructed the IMF to publish all the document once the approval has been given. The documents will be out there for the public to continue to scrutinise and to help monitor. It is important because we are suppose to implement a number of measures and to the extent that the public must know what these measures are”, he added.

“Through this, they [Ghanaians] will be able to ask relevant questions as to how we are performing. Public accountability will continue to be a feature of the Ghanaian politics. We have a strong parliament who are not afraid to ask relevant questions and so we want to be as transparent as possible and that is the commitment the president [Akufo-Addo] has made”, the Minister of State.

 

 

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