The International Monetary Fund (IMF)’s acceptance of a $ 3 billion bailout for Ghana, according to former Finance Minister, Seth Terkper, will have a significant impact on the incoming administration.
He stated that he is looking forward to the Fund’s announcement on the program’s complete contents.
However, Mr. Terkper said that while the permission was a “welcome respite,” it also meant that there was still “more work to be done, as we look down at reviews and debt restructuring.”
“I acknowledged its respite … but noted, we have more work ahead [esp., external debt restructuring]. We wait for full document … will definitely have serious implications for next administration. Note; the current govt took over 2015 ECF with a better scenario.”
Seth Terkper
According to the Finance Ministry, the $3 billion bailout and other reforms implemented by the government will put Ghana in a strong position for economic recovery. Following Ghana’s acquisition of the Paris Club funding assurance on Friday, May 12, the Board of the International Monetary Fund unanimously approved Ghana’s bailout, during a meeting in Washington on May 17 (Wednesday).
According to a press release from the Paris Club, “The creditor committee stresses that the Ghanaian authorities are expected to seek debt treatments from all private creditors and other official bilateral creditors on terms, at least as favorable as those being considered by the creditor committee, in line with the comparability of treatment principle.”
In light of this, it was further stated that “the creditor committee urges private creditors and other official bilateral creditors to commit without delay to negotiate with Ghana, such debt treatments that are crucial to ensure the full effectiveness of the debt treatment for Ghana under the Common Framework.”
A committee of creditors for Ghana has also been established by nations with legitimate claims to ensure the swift application of the resolution. China and France are anticipated to co-chair the creditor committee.
“The creditor committee examined the macroeconomic and financial situation of Ghana, including its long-term debt sustainability, and its formal request for a debt treatment under the “Common Framework for Debt Treatments beyond the DSSI” endorsed under the Saudi G20 Presidency in November 2020, which was also endorsed by the Paris Club.
“The creditor committee supports Ghana’s envisaged IMF upper credit tranche (UCT) program and its swift adoption by the IMF Executive Board to address Ghana’s urgent financing needs. The creditor committee encourages Multilateral Development Banks (MDBs) to maximize their support for Ghana to meet its long-term financial needs.”
Paris Club
IMF To Give Full Details Today
Today, May 18, the International Monetary Fund (IMF) will provide information on Ghana’s disbursements.
A virtual press conference will be held on Thursday in Washington, DC, according to a media advisory released by the IMF on Wednesday. This is to “brief journalists on the outcomes of IMF Executive Board meeting on Ghana’s request for an Extended Credit Facility Arrangement, which will take place on Wednesday, May 17,” the advisory reads.
Stephane Roudet, IMF Mission Chief for Ghana, will be joined at the press conference by Minister of Finance, Kenneth Nana Yaw Kuntukunuku Ofori-Atta and Central Bank Governor, Dr. Ernest Kwamina Yedu Addison.
Tatiana Mossot, senior communications officer for the IMF, will oversee the news conference.
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