Associate Professor of Finance at Andrews University in Michigan, USA, Professor Williams Peprah, is cautioning that the first tranche, together with the remaining expected fund to add up to the $3 billion financial bailout from the International Monetary Fund (IMF) will not lead to a swift economic recovery in the country.
This, according to him, is the case because the managers of the economy will have to adhere to strict financial restoration plans by increasing revenue as well as strictly limiting expenditure, a key requirement by the IMF.
“That is, IMF will strengthen their technical supervision on Ghana to be financially disciplined.”
Professor Williams Peprah
Prof. Peprah welcomed the Financing Assurance to Ghana Creditor Committee under the G20 Common Framework, saying, “It is good news that Ghana will be receiving the needed IMF financial bailout to support the balance of payment challenges.”
“What the bailout will do in the next six months is to ensure stable exchange rate that will lead to stable prices, reduce inflation and boost investor confidence economic confidence by investors.”
Professor Williams Peprah
However, the Professor further noted that the first tranche of the IMF bailout fund, which will be used to pay creditors, will assist the country’s creditworthiness recover from the downgrades that the rating agencies had given it.
IMF’s First Payment To Reach The BoG Account This Week
Meanwhile, it can be recalled that earlier today, the ministry of finance disclosed that the first tranche of International Monetary Fund (IMF) cash to support the country’s balance of payment is expected to hit the Bank of Ghana’s account this week.
The IMF Board, as noted by the ministry, is anticipated to approve the “cash disbursement” as soon as it considers a request for Ghana’s Programme this Wednesday, May 17, 2023.
The transfers, as stated, would be done in two instalments; part of the first tranche coming in by Friday March 19, 2023, or or Monday, May 22, 2023, while the remaining should be disbursed by June 2023.
This will be followed by a visit by an IMF Mission to Ghana in June 2023 to review Ghana’s programme considerations.
Another review is expected just before the end of 2023, possibly in December 2023, before the final disbursement. All the funds will be paid directly into the Bank of Ghana’s account to support Ghana’s balance of payments needs.
Ghana is expected to get about $3 billion spread over a period of three years under the IMF programme.
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