Ghana is on track to receive $360 million from the International Monetary Fund (IMF) in December 2024, following a successful third review under the Extended Credit Facility (ECF) program.
This announcement was made by Julie Kozack, the IMF’s Director of Communications, during a press briefing in Washington, D.C., USA. The IMF board is expected to meet in early December to finalize the disbursement.
Ms. Kozack commended Ghana’s progress in meeting the requirements of the fund’s program, particularly regarding debt restructuring. She described the program’s performance as encouraging, highlighting the country’s commitment to fulfilling the benchmarks established under the ECF arrangement.
“Ghana has followed the requirements needed for the country’s debt restructuring,” Kozack remarked. She also emphasized the importance of continued reforms, cautioning against decisions that could lead to setbacks.
The third review underscores Ghana’s progress in stabilizing its economy, with Kozack pointing to macroeconomic improvements. “Economic growth in the first half of 2024 exceeded our expectations. Inflation has declined, and the fiscal and external positions have shown marked improvement,” she added.
Impressive Economic Growth in 2024
According to the IMF’s third review assessment, Ghana’s economic growth in the first half of 2024 outpaced initial projections. This growth was driven by robust activity in the mining, construction, and information and communication sectors. Additionally, the sources of growth broadened in the second quarter, as inflation continued to decline, signaling a return to macroeconomic stability.
The IMF staff noted that all end-June 2024 quantitative targets under the program were met. Structural reforms, although delayed in some areas, have made significant progress. These developments provide a solid foundation for sustained recovery.
Despite the positive outcomes, Ms. Kozack stressed the importance of continued policy implementation and reforms to maintain the current trajectory. “Looking ahead, it will be important for Ghana to continue implementing the policy and reform agendas,” she noted.
The IMF emphasized the need to fully restore macroeconomic stability and debt sustainability, particularly in the face of global economic uncertainties. The release of the staff report after the December board meeting will provide further updates on Ghana’s progress.
The upcoming disbursement will bring the total funds received by Ghana under the IMF program to $1.92 billion since it signed the ECF agreement. This follows the October 4th staff-level agreement between the IMF and the Ghanaian government on economic policies and reforms under the third review.
The ECF program has been instrumental in guiding Ghana through challenging economic conditions. It has provided the framework for fiscal discipline, monetary policy adjustments, and structural reforms aimed at addressing Ghana’s economic vulnerabilities.
Debt restructuring has been a cornerstone of Ghana’s recovery strategy under the IMF program. Significant progress has been made in this area, ensuring that Ghana meets the financial sustainability benchmarks.
Additionally, inflation management has been a major focus, with inflation showing a marked decline throughout 2024. This has contributed to improved fiscal and external positions, fostering a conducive environment for economic recovery.
While the progress is commendable, challenges remain. Ghana must avoid policy slippages and maintain a firm commitment to the reforms outlined in the IMF program. The country faces a global economic landscape fraught with uncertainties, necessitating prudent economic management.
The December board meeting will mark a critical milestone in Ghana’s journey under the ECF arrangement. The anticipated $360 million disbursement will provide much-needed fiscal space to support ongoing reforms and stimulate economic activity.
Meanwhile, the IMF’s endorsement of Ghana’s economic policies and the positive outlook for 2024 signal a new chapter of hope and opportunity for the nation.
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