BoG Governor assures timely receipt of IMF tranche, cocoa syndication loan
Dr. Ernest Addison, Governor of the Bank of Ghana (BoG), has reassured stakeholders that the country is poised to secure the second tranche of the International Monetary Fund (IMF) bailout package and the cocoa syndication loan by the close of 2023.
Dr. Addison’s confidence in the process, however, is tempered by concerns arising from the ongoing restructuring of Zambia’s bonds. The discord among creditors over the distribution of losses raises apprehensions about potential delays in finalizing Ghana’s negotiations with the Official Creditor Committee.
Despite apprehensions about timely fund disbursement, Dr. Addison affirmed that the overall progress is promising. He highlighted the mitigating measures the Bank of Ghana can activate to stabilize the cedi, should delays occur in the disbursement of the cocoa syndication loan for the Ghana Cocoa Board (COCOBOD).
The IMF Board’s meeting, initially slated for November 22, 2023, to review Ghana’s first program and staff report, has been rescheduled to the first week of December 2023. This adjustment follows concerns raised by a partner of the Official Creditor Committee regarding the cut-off date for restructuring Ghana’s debts. The government, nonetheless, remains optimistic about securing the IMF funds before the year’s end.
On the currency front, Dr. Addison expressed optimism about the cedi’s outlook in the coming weeks. Despite a cumulative 6.6% depreciation against the US dollar from February to November 20, 2023, he attributed the relative stability to various factors, including inflows from the IMF ECF first tranche and other strategic initiatives.
Regarding monetary policy, the Bank of Ghana’s Monetary Policy Committee opted to maintain the policy rate at 30.0%, marking the second consecutive decision in 2023. Despite a decline in inflation, Dr. Addison underscored the necessity of keeping the policy rate tight until inflation firmly aligns with the downward trajectory toward the medium-term target.
As Ghana grapples with economic intricacies, it remains to be seen how the nation will navigate the global financial landscape amid evolving challenges and uncertainties.
