IMF to Approve $360 Million Disbursement to Ghana Following Positive Program Review

The International Monetary Fund (IMF) is poised to disburse $360 million to Ghana following the country’s successful completion of the third review under its Extended Credit Facility (ECF) arrangement. The IMF board is expected to meet in early December 2024 to finalize the approval, marking another milestone in Ghana’s economic recovery program.

Julie Kozack, the IMF's Director of Communications, announced during a press briefing in Washington, D.C., that this disbursement would bring the total funds received by Ghana under the program to $1.92 billion. “Once the review is completed by the IMF's executive board, Ghana would have access to about $360 million in terms of disbursement,” she confirmed. While the exact date for the meeting is yet to be disclosed, Kozack noted that IMF staff are working diligently toward finalizing the board discussions.

Ghana’s performance under the IMF program has been described as encouraging, with notable achievements in debt restructuring and macroeconomic recovery. “Programme performance has been good. There has been, in particular, remarkable progress on debt restructuring,” Kozack emphasized. This success has bolstered confidence in Ghana’s ability to navigate its economic challenges and meet the benchmarks set under the program.

Economic indicators for the first half of 2024 exceeded projections, with growth largely driven by mining, construction, and information and communication technology. Kozack highlighted that these sectors have contributed to broadening the sources of growth across the economy. Additionally, inflation has declined, and both fiscal and external positions have improved significantly, signaling a gradual stabilization of Ghana’s economy.

Despite these gains, the IMF has cautioned Ghana against policy missteps that could derail its progress. “Looking ahead, what will be important for Ghana will be continued implementation of the policy and reform agendas, especially given the difficult situation that many countries in the region and globally face. It remains essential to fully restore macroeconomic stability and debt sustainability,” Kozack stated.

The IMF’s analysis further revealed that Ghana met all its quantitative targets for the end of June 2024. Structural reforms, while progressing, have faced some delays in a few areas. Nonetheless, the overall outlook remains positive. According to the IMF staff report, growth in the first half of the year was significantly higher than anticipated, driven by increased activities in key sectors and declining inflation. This momentum indicates a broadening of economic recovery and suggests that Ghana is on the right path to achieving sustained growth.

The December board meeting will serve as a crucial checkpoint for Ghana as it seeks to maintain the momentum achieved under the ECF program. Since signing up for the program, Ghana has demonstrated its commitment to fiscal discipline and economic reforms, which have played a pivotal role in its recovery efforts.

The IMF staff and the Ghanaian government reached a staff-level agreement on economic policies and reforms for the third review on October 4, 2024. This agreement laid the groundwork for the December board meeting and subsequent disbursement. According to the IMF, these efforts are vital for addressing Ghana’s debt burden while ensuring long-term economic stability.

While Ghana’s economic recovery is on track, continued vigilance and adherence to the reform agenda will be critical in navigating uncertainties and safeguarding the gains made thus far. The upcoming disbursement underscores the IMF’s confidence in Ghana’s efforts, but it also places a spotlight on the importance of sustained policy implementation to secure the country’s economic future.