Ghana is on track to sign an IMF agreement shortly, John Kumah promises

The government has expressed hope of securing the Paris Club financing assurances within the shortest possible time to enable the 3 billion dollar support from the International Monetary Fund.

This follows the government’s engagement with bilateral and multilateral partners at the recent IMF and World Bank Spring meetings in America.

Addressing the media in Parliament, Deputy Finance Minister, John Kumah assured that discussions towards securing the fund have been fruitful.

“Ghana is very hopeful, the Minister for Finance just returned from the spring meeting from the US and took the opportunity to meet our bilateral partners and multilateral partners and I can say that we are very hopeful that we will secure the Paris Club financing agreement very soon.”

“I’m unable to give timelines, but I can assure you that discussions are going very well and very soon Ghana will get the good news.”

Meanwhile, Ghana’s hope of securing an IMF board approval is expected to delay owing to prolonged external debt-restructuring negotiations, and the involvement of numerous stakeholders in the process, according to the Economic Intelligence Unit (EIU).

The EIU in its 2023 Country Report on Ghana, stated that it anticipates Ghana to secure restructuring agreements on its public external debt during 2023-24, involving official and private creditors alike.

It, however, notes that, given the country’s pressing macroeconomic crisis, “the conclusion of a domestic debt-swap operation in February and increasing international attention on speeding up external debt restructuring, our core forecast remains that the IMF programme will be approved by mid-2023.”

“We expect Ghana to secure restructuring agreements on its public external debt during 2023-24, involving official and private creditors alike. This will include a combination of write-offs, maturity extensions and reductions in interest rates. We expect official creditors to agree to a deal in 2023, and this, combined with the domestic debt restructuring that has already been secured, should provide enough reassurance to reduce Ghana’s risk of debt distress and allow the IMF to approve the agreed programme”.

“However, there is a material risk that IMF board approval will be delayed owing to prolonged external debt-restructuring negotiations, given the involvement of multiple stakeholders in the process,” it noted.