IMF approves a $360 million loan to boost Ghana’s economy

Days before Ghanaians cast their ballots to choose their next president, the IMF executive board decided on Monday to authorize the immediate transfer of approximately $360 million to strengthen Ghana’s economy.

In a statement announcing the board’s approval, the International Monetary Fund said, “Ghana’s performance under the program has been generally satisfactory, and reform efforts are paying off.”

Ghana

It further stated that while inflation had decreased and economic growth was rebounding, “good progress” had been achieved on debt restructuring.

Ghana, a leading producer of oil, gold and cocoa, suffered a severe financial crisis in 2022, which forced the government to default on its external debt and to negotiate a three-year, $3 billion relief package with the IMF.

The economy has emerged as a key issue ahead of Ghana’s presidential election on December 7 — a tight race between the ruling NPP party candidate and current Vice President Mahamudu Bawumia and former president and NDC party candidate John Mahama.

The board’s approval of the latest loan review unlocks around $360 million, bringing the total disbursed since the loan agreement was approved in May 2023 to around $1.9 billion.

“Looking ahead, staying the course of fiscal policy adjustment — including before and after the upcoming elections — and creating room to enhance social programs is paramount to put public finances on a sustainable path and reduce financing needs,” IMF deputy managing director Bo Li said in a statement.

Li added it was also important to cushion “the vulnerable from the impact of fiscal adjustment.”

The IMF said it expects Ghana’s GDP to grow by 4.0 percent this year and by 4.4 percent in 2025.

Inflation is expected to ease from an annual rate of 18.0 percent at the end of this year to 8.0 percent by the end of 2025.