The International Monetary Fund (IMF) Executive Board has completed the third review of Ghana's Extended Credit Facility (ECF) arrangement, a $3 billion program over 36 months that began in May 2023. This completion allows for an immediate disbursement of SDR 269.1 million, approximately $360 million, bringing the total disbursements to about $1.9 billion.
Ghana's policy and reform efforts under the IMF-supported program have shown positive results after facing economic challenges in 2022. The program has helped stabilize macroeconomic policies and launch reforms aimed at restoring stability and debt sustainability while promoting growth. Growth is recovering, inflation is declining, albeit slowly, and fiscal and external positions are improving. However, the medium-term outlook faces risks from elections and energy sector challenges.
Ghana has met all quantitative performance criteria for this review period and made progress on structural reforms despite some delays. The government continues to restructure public debt successfully, having restructured domestic debt last year and reached an agreement with Ghana’s Official Creditors Committee under the G20 Common Framework in June 2024.
Fiscal performance is on track to achieve a primary surplus of 0.5% of GDP despite spending pressures from a dry spell and energy sector issues. The authorities aim to reach a primary fiscal surplus of 1.5% of GDP by 2025 through revenue mobilization and expenditure rationalization while expanding social programs.
The Bank of Ghana maintains prudent monetary policies to reduce inflation risks and rebuild international reserves while strengthening financial sector stability through bank recapitalization efforts.
Deputy Managing Director Bo Li stated: "Ghana’s performance under its ECF-supported reform program has been generally satisfactory. The authorities’ economic strategy is delivering on its objectives, with the economy showing clear signs of stabilization."
Li emphasized that continued fiscal policy adjustments before and after upcoming elections are crucial for sustainable public finances while protecting vulnerable populations from fiscal adjustments' impacts.
In conclusion, maintaining macroeconomic policy adjustments is essential for restoring stability, ensuring sustainable growth, reducing poverty, addressing energy sector challenges, completing debt restructuring timely, enhancing revenue mobilization, streamlining expenditures, improving tax administration, strengthening expenditure control management of arrears along with SOEs management improvements remain critical areas for focus.