<\/p>\n
The International Monetary Fund has confirmed that a staff team is expected in Ghana this week to continue discussions with the government on policies and reforms that can be supported by the Fund.<\/p>\n
\u201cAn IMF staff team, led by St\u00e9phane Roudet, Mission Chief for Ghana, will visit Accra from September 26 \u2013 October 7 to continue discussions with the Ghanaian authorities on policies and reforms that could be supported by an IMF lending arrangement,\u201d the Fund said in a statement on its website.<\/p>\n
The statement said the IMF staff would also further engage with other\u00a0stakeholders\u00a0during the visit.<\/p>\n
The government of Ghana turned to the IMF for help in July as its balance-of-payments deteriorated leading to economic hardship.<\/p>\n
Why is Ghana requesting an IMF program?<\/p>\n
The IMF in an answer to questions asked by stakeholders on its website said Ghana\u2019s fiscal and debt vulnerabilities were worsening fast amid an increasingly difficult external environment.<\/p>\n
It said \u201cduring the COVID-19 pandemic, Ghana\u2019s public debt increased from 65 per cent to 80 per cent of GDP. At the same time, the government\u2019s fiscal efforts to preserve debt sustainability were not seen as sufficient by investors, leading to credit rating downgrades, non-resident investors exit from domestic bond market and loss of access to international capital markets.\u201d<\/p>\n
\u00a0These adverse developments, it said further exacerbated by the price and supply-chain shocks from the war in Ukraine, have led to a large exchange rate depreciation, a surge in inflation and pressure on foreign exchange reserves in the past months.<\/p>\n
\u201cIn this context, the government has requested assistance from the IMF, and we have kick-started the initial discussions on how to best address Ghana\u2019s challenges,\u201d it said.<\/p>\n
It said an IMF-supported programme aimed to provide space for Ghana to implement policies which would restore macroeconomic stability and anchor debt sustainability while protecting the most vulnerable parts of the population.<\/p>\n
\u201cIt should help create the conditions for inclusive and sustainable growth and job creation. This will help strengthen policy credibility, alleviate exchange rate pressures, and provide catalytic effect on financing,\u201d it said.<\/p>\n
Is Ghana seeking a three-year ECF programme of \u00a0$3 billion?<\/p>\n
The IMF said the Extended Credit Facility (ECF) was the Fund\u2019s main tool for medium-term support to countries facing protracted balance of\u00a0payments\u00a0problems, similar to Ghana\u2019s.<\/p>\n
\u201cThe duration of such arrangement is between 3 to 4 years and extendable to 5 years. Ghana requested a similar arrangement in 2014 and which lasted 4 years. However, the level of access and the final programme design is ultimately decided by the IMF Executive Board. Since negotiations for the programme are starting now, it is too early to comment on the final form the programme will take,\u201d it said.<\/p>\n
On whether the IMF programme would impact the government\u2019s Free Senior High School policy it said \u201cWe are still at an early stage in the discussions, but we believe that the free Senior High School (SHS) is an innovative policy that needs to be protected. In general, IMF-supported programmes seek to boost social spending while encouraging both efficiency and sustainability.\u201d<\/p>\n
It said the IMF-supported programme would aim at protecting the vulnerable and creating conditions for an inclusive growth.<\/p>\n
Source: ghanaiantimes.com.gh<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n Featured Video\n<\/p>\n\n
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