The Government of Ghana and the International Monetary Fund (IMF) have reached a staff-level agreement on the fourth review of the country’s economic reform programme under the Extended Credit Facility (ECF). The agreement, announced at the end of a two-week mission in Accra, remains subject to approval by the IMF Executive Board.
Led by Mission Chief Stéphane Roudet, the IMF delegation visited Ghana from 2 to 15 April 2025 to assess progress on the government’s policy and reform agenda. The current programme, approved in May 2023, provides Ghana with access to approximately US$3 billion over three years.
Should the Board approve the latest review, Ghana will gain access to an additional SDR 267.5 million (roughly US$370 million), bringing total disbursements under the programme to around US$2.36 billion.
According to Mr Roudet, economic growth in 2024 outperformed expectations, driven largely by strong activity in the mining and construction sectors. The country’s external position also improved significantly, aided by rising gold exports and an uptick in remittance inflows. This contributed to stronger-than-expected accumulation of international reserves.
However, despite these positive developments, the IMF highlighted a deterioration in overall programme performance towards the end of 2024. Preliminary data suggest fiscal slippages ahead of the general elections, marked by a sharp rise in unpaid obligations and missed inflation targets. Several planned reforms across the fiscal, financial, and energy sectors were also delayed.
In response, Ghana’s new administration has moved to address the shortfalls. An audit of outstanding payables is underway, and the 2025 budget aims to reverse the fiscal slippage by targeting a primary surplus of 1.5% of GDP. New public financial management measures, including tighter controls on expenditure and a revised fiscal responsibility framework, have also been introduced.
The IMF said discussions also focused on the need for deeper structural reforms, particularly in public financial management and procurement. Authorities are also taking steps to strengthen social protection programmes, aimed at shielding the most vulnerable from inflation and economic adjustment.
In the monetary sector, the Bank of Ghana has tightened policy by raising its key interest rate and adjusting its liquidity management operations, with the goal of reining in inflation.
The IMF also reported ongoing engagement with the government on broader reforms, including efforts to improve governance, transparency, and the performance of state-owned enterprises—particularly in the gold, cocoa, and energy sectors. Structural changes in the energy sector, including the return of quarterly tariff adjustments, are expected to help stem financial losses and prevent further arrears.
On debt restructuring, the IMF confirmed that Ghana has signed a Memorandum of Understanding with its Official Creditors Committee under the G20 Common Framework. The government is also pursuing negotiations with commercial creditors in line with the programme’s terms.
The IMF team met with key government figures, including Finance Minister Mohammed Amin Adam and Bank of Ghana Governor Elsie Addo Awadzi, as well as representatives from various ministries and civil society.
The Fund concluded by expressing appreciation for the “open and constructive” dialogue with Ghanaian officials and reaffirmed its support for the country’s reform efforts.
Source:TheDotNews