Ghana should stick the course – IMF advises Ghana

Economy & Investments International Monetary Fund IMF
FEB 6, 2024 LISTEN
International Monetary Fund (IMF)

The International Monetary Fund (IMF) has asked Ghana to follow through with the implementation of the US$3 billion loan support programme.

“It is important that Ghana sticks the course and see the programme being implemented over the next three years,” said Mr Abebe Aemro Selassie, African Department Director, IMF.

“What I can say is that going forward, it will be important that Ghana continues to implement the programme that they have developed as envisaged. That is critical,” Mr Selassie said.

He said this during a media briefing on Sub-Saharan Africa's economic outlook, and the Fund's engagement with various countries.

The Fund encouraged Ghanaian authorities, at the end of the first review Extended Credit Facility (ECF) arrangement last month to among others, improve tax administration.

The government has since announced the implementation of a 15 per cent Value Added Tax (VAT) on electricity consumption and a GHS100 annual emission levy for petrol and diesel car owners, with agitations from labour and trade unions.

Assessing the state of the implementation of the country's Post COVID-19 Programme for Economic Growth (PC-PEG), he said, “Ghana's programme is being implemented effectively.”

“We just went to the Board with the first programme review following, of course, the policies that the government has been putting in place to address the huge imbalances Ghana was facing through last year,” he stated.

The IMF African Department Director stated that such steps had led to official creditors signalling that they would provide debt relief, consistent with what Ghana needed.

“These programmes are designed to be implemented over three, four years. So, we look forward to continuing to support Ghana, consistent with programme implementation,” he said.

So far, Ghana has received US$1.2bn of the US$3bn from the IMF, having completed its first review of the programme, leading to the disbursement of a second tranche of US$600m to the country in January 2024.

The government has pledged that it would implement strong, and ambitious structural reforms in the areas of tax policy, public financial management, financial, energy and cocoa sectors to support fiscal consolidation and growth agenda.