In mid-May 2023 the International Monetary Fund (IMF) finally approved a US$3 billion 36-month arrangement with Ghana. It immediately disbursed the first tranche of US$600 million. This is the second time in the past eight years that the country has approached the IMF. And it’s the 17th time since independence in 1957 – that’s roughly once every four years on average. The first tranche of the latest loan is expected to be used to bolster Ghana’s foreign currency reserves and help stabilise the cedi as well as for budget support, according to the finance ministry. Fixing Ghana’s external debt issues under the latest IMF programme would be highly challenging, given the recent experiences of Zambia and others under the G20 Common Framework. Ghana, like Zambia, may become a victim of the international geopolitics of debt, prolonging debt relief and making it even more vulnerable. Also, while some governance reforms are proposed under the IMF programme, political party campaign financing is not addressed. This is a major part of the root causes of the country’s persistent fiscal and debt vulnerabilities, especially at state-owned enterprises.
Ghana’s Economy and its IMF Engagements
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