statement<\/a> issued by its Deputy Managing Director and Acting Chair, Mr. Naoyuki Shinohara. It has also given Ghana the green light to contract the $3 billion China loan to be used for infrastructure development.<\/p>\nAccording to the IMF, its Board also approved a \u201cmodification of a performance criterion related to Ghana\u2019s non-concessional borrowing limit to provide additional room for scaled-up infrastructure investment.\u201d<\/p>\n
Per an agreement signed with the IMF in July 2009, Ghana\u2019s limit of commercial borrowings is up to $800 million a year.<\/p>\n
The lender, even though did not give details of the modifications, it is believed that it has given a go ahead for Ghana to secure the $3 billion loan from the China Development Bank.<\/p>\n
The IMF and the World Bank economists have been studying the terms of the $3 billion loan after officials from Ghana\u2019s Ministry of Finance asked them to assess the implications of the credit.<\/p>\n
According to the Africa-Asia Confidential (AAC) news publication on December 14, 2011, an internal Bank document it has seen reported that \u2018the joint IMF-World Bank Debt Sustainability Analysis, based on critically conservative assumptions, concludes that Ghana\u2019s economy could accommodate the CDB loan without aggravating risks of external debt distress but requires prudent fiscal policy.\u2019<\/p>\n
Although the loan would be partly repaid with oil exports, these would be at the prevailing market prices and therefore would not be an extra cost on the loan, according to the publication citing the Bank assessment.<\/p>\n
The document, according to AAC, says the gas infrastructure project deserves the \u2018highest and most urgent attention\u2019 adding that the gas, \u2018which comes as a by-product to the extraction of oil, is currently mostly being re-injected to avoid flaring in large quantities.<\/p>\n
Financial returns, the Bank argues, would be much greater if the project included a plant for liquefied petroleum gas (LPG) production. This would generate income that would alone \u2018cover 80%, in net present value terms, of the financial costs (interest and principal) to be incurred on the entire $3 billion amount of the China loan agreement.\u2019<\/p>\n
The AAC says an independent consultant\u2019s report it has seen sent to the Ghana government reckoned the value of LPG produced at Jubilee was about $200 million a year.<\/p>\n
By Ekow Quandzie<\/p>\n
Comments<\/h4><\/p>\n","protected":false},"excerpt":{"rendered":"
You Are Here: Home \u00bb General News , Lead Story \u00bb IMF lends Ghana $91.5m, endorses $3b China loan Page last updated at Thursday, December 15, 2011 8:08 AM \/\/ The Executive Board of the International Monetary Fund (IMF) December 14, 2011 completed the fifth review of Ghana\u2019s economic performance under its programme supported by the Extended Credit Facility (ECF). \u201cThe completion of the review will enable the disbursement of an amount equivalent to SDR 59.58 million (about US$91.55 million), bringing total disbursements under the arrangement to SDR 268.31 million (about US$412.28 million),\u201d the IMF said in a statement issued by its Deputy Managing Director and Acting Chair, Mr. Naoyuki Shinohara. <\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-14003","post","type-post","status-publish","format-standard"],"yoast_head":"\n
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<\/a>The Executive Board of the International Monetary Fund (IMF) December 14, 2011 completed the fifth review of Ghana\u2019s economic performance under its programme supported by the Extended Credit Facility (ECF).<\/p>\n