Nearly a month after the start of the $3 billion loan-support programme with the International Monetary Fund (IMF), the economy of Ghana is beginning to show signs of stabilisation.
This was the initial conclusion reached by the Stéphane Roudet-led IMF Mission team as they observed Ghana’s ongoing Extended Credit Facility (EFC) programme with the Fund for a week.
“Against a complex global economic backdrop, the Ghanaian economy is showing signs of stabilisation, with softening inflation, an increase in international reserves, and a less volatile exchange rate,” Mr. Roudet said at the end of the mission.
He stated that the team evaluated the Ghanaian government’s performance in fulfilling important ECF commitments, which would be formally evaluated during its first review, which is anticipated to be completed between September and November 2023.
The Chief of Mission emphasised once more that Ghana must promptly restructure its debt agreements with its creditors in order to reap the anticipated benefits of the Fund-supported programme.
As part of its routine interaction with the Ghanaian government and other stakeholders, the IMF staff team headed by Mr. Roudet visited Ghana from June 8 to 15.
Meetings were held with President Akufo Addo, Vice President Bawumia, Finance Minister, Ken Ofori-Atta, Bank of Ghana Governor, Dr. Ernest Addison, and the Fund’s Mission Team.
Additional meetings were held with representatives of the private sector, Civil Society Organisations, the Finance Committee of Parliament, and other government agencies.
The IMF team was appreciative of the Ghanaian government and other stakeholders’ “constructive engagement and support during this mission,” according to Mr. Roudet.
The IMF loan-support programme was approved in May, and Ghana’s inflation, which was 53.6% at the start of 2023, eased to 41.2% in April. However, when the Statistical Service released the most recent inflation data, it saw a slight increase to 42.2%.
Regarding foreign exchange reserves, the BoG reported that Ghana’s reserve increased from $5.1 billion to $5.7 billion as a result of the IMF’s first tranche of 600 million dollars, strengthening the country’s balance of payments position.
Although there has been some fluctuation in the exchange rate since the beginning of the year, there has been less volatility recently, with the rate being US$1 against GHS10.97 in recent weeks.
In an effort to hasten the nation’s recovery from an economic crisis brought on by a pandemic, the Russia-Ukraine war, and internal structural issues, Ghana’s Post COVID-19 Programme for Economic Growth (PC-PEG) programme will offer balance of payments support over the course of its three years.
Additionally, it is intended to reduce pressure caused by fluctuating exchange rates and a weakening currency, foster the development of inclusive and sustainable growth and job creation, and act as a catalyst for the development of new financial resources.