IMF to dispatch another team to Ghana in coming weeks

The International Monetary fund(IMF) is set to deploy another mission to Ghana in the coming weeks following Ghana’s request for a bailout Gerry Rice, the Director of Communications for the IMF said at a media engagement.

“We had an IMF staff team in Accra in July to begin initial discussions with the Ghanaian authorities. And we characterized that mission as constructive, kick started the process, and laid the groundwork for engagement, which now continues.

“Our Mission Chief for the IMF also recently visited Accra, again, to meet with key counterparts. And we’re hopeful for another visit in the coming weeks, I don’t have a date for you, but in the coming weeks,” Gerry Rice disclosed.

Ghana is seeking a $3 billion package from the fund to shore up its economy.

When the IMF team first visited, they that the country is facing challenging economic and social situation.

The IMF staff team led by Carlo Sdralevich visited Accra during July 6-13, 2022, to assess the current economic situation and discuss the broad lines of the government’s Enhanced Domestic Program that could be supported by an IMF lending arrangement.

The IMF team met with Vice President Dr Mahamudu Bawumia, Finance Minister Ken Ofori-Atta, and Governor Ernest Addison of the Bank of Ghana. The team also met with the Parliament’s Finance Committee, civil society organizations, and development partners, including UNICEF and the World Bank to engage on social spending.

At the conclusion of the mission, Mr. Sdralevich said: “Ghana is facing a challenging economic and social situation amid an increasingly difficult global environment. The fiscal and debt situation has severely worsened following the COVID-19 pandemic. At the same time, investors’ concerns have triggered credit rating downgrades, capital outflows, loss of external market access, and rising domestic borrowing costs.

“In addition, the global economic shock caused by the war in Ukraine is hitting Ghana at a time when the country is still recovering from the Covid-19 pandemic shock and with limited room for maneuver. These adverse developments have contributed to slowing economic growth, accumulation of unpaid bills, a large exchange rate depreciation, and a surge in inflation.”

He disclosed that “the IMF team held initial discussions on a comprehensive reform package to restore macroeconomic stability and anchor debt sustainability. The team made progress in assessing the economic situation and identifying policy priorities in the near term. The discussions focused on improving fiscal balances in a sustainable way while protecting the vulnerable and poor; ensuring credibility of the monetary policy and exchange rate regimes; preserving financial sector stability; and designing reforms to enhance growth, create jobs, and strengthen governance.”

He noted that the “IMF staff will continue to monitor the economic and social situation closely and engage in the coming weeks with the authorities on the formulation of their Enhanced Domestic Program that could be supported by an IMF arrangement and with broad stakeholders’ consultation”.

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He reaffirmed the IMF’s commitment to support Ghana at this difficult time, consistent with the IMF’s policies.