2nd IMF Tranche: Negotiation talks deadlocked over cut-off point dispute with Creditor Committee – Minority Leader
The Minority in Parliament has voiced apprehensions regarding an apparent impasse in negotiations for the second tranche of a $3 billion credit facility from the International Monetary Fund (IMF).
Dr. Cassiel Ato Forson, leader of the Minority caucus, highlighted the discord between the government and the International Creditors’ Committee, casting a shadow on the ongoing discussions.
At the heart of the disagreement is the cut-off point for external debt in the intricate process of debt restructuring—a pivotal determinant for unlocking the next tranche of $600 million from the IMF.
Dr. Forson, during his conclusive remarks on the 2024 budget debate in Parliament on November 29, 2023, sounded the alarm, stating, “Ghana is between a rock and a hard place” in the face of this deadlock.
He elaborated, “There is a major disagreement on the cut-off point, regarding the external debt that must be excluded from the restructuring.”
The ramifications of this deadlock raise critical questions about the trajectory of negotiations and the consensus between Ghana and the IMF in securing the crucial financial assistance package.
“If Ghana accepts the cut-off point proposed by the International Creditors’ Committee, it would result in more debt being excluded from the ongoing debt restructuring,” warned Dr. Forson.
This scenario would necessitate the immediate inclusion of the excluded debt in the budget to facilitate its servicing, altering the fiscal landscape significantly.
Ghana’s economic challenges prompted the acquisition of a $3 billion bailout package from the IMF, aimed at addressing issues such as high debt, inflation, and a depreciating currency. The first installment of $600 million has already been received, with the IMF awaiting the outcome of Ghana’s discussions with bilateral creditors before disbursing the next tranche.
As the deadlock persists, Ghana faces a pivotal juncture, navigating the intricate terrain of debt restructuring and international negotiations, with potential repercussions resonating throughout its economic landscape.
