The International Monetary Fund (IMF) has approved the second review of Ghana’s $3 billion loan program, which allows for the immediate disbursement of approximately $360 million.
This decision follows Ghana’s successful negotiation with its official creditor committee, a necessary step to unlock the second tranche of the loan.
This latest disbursement brings the total IMF funds received by Ghana under the three-year bailout program to $1.56 billion.
The program is designed to assist Ghana in overcoming its most severe economic crisis in a generation.
The IMF’s statement praised Ghana’s performance, noting the country’s efforts to restore macroeconomic stability and reduce debt vulnerabilities are showing positive results.
IMF Deputy Managing Director Kenji Okamura commented on Ghana’s progress, stating, “The authorities’ strategy aimed at restoring macroeconomic stability and reducing debt vulnerabilities is paying off, with clear signs of stabilization emerging.”
Ghana is expected to receive the funds within two days, according to a source at the country’s central bank.
The need for IMF support arose in 2022 when Ghana faced severe economic challenges, including a depreciating cedi, soaring inflation, and high debt-service costs exacerbated by the COVID-19 pandemic, Russia’s invasion of Ukraine, and high global interest rates.
Despite these challenges, Ghana’s economy has shown signs of recovery. Economic growth in 2023 was 2.9%, and the first quarter of 2024 saw a growth rate of 4.7%. Inflation has significantly decreased from a peak of over 54% in December 2022 to 23.1% recently, although the cedi continues to depreciate.
Mr Okamura emphasized the importance of continued macroeconomic policy adjustments and reforms to fully restore stability and debt sustainability.
Ghana is restructuring its $30 billion debt under the G20’s Common Framework mechanism and recently reached an agreement with two bondholder groups to restructure approximately $13 billion of its debt, moving closer to completing its debt overhaul.
