IMF Reaches Staff-Level Agreement on Third Review of Ghana’s Extended Credit Facility
An International Monetary Fund (IMF) team, led by Mission Chief for Ghana, Stéphane Roudet, has successfully reached a Staff-Level Agreement on the third review of the Extended Credit Facility with Ghana. This agreement follows a series of meetings held in Accra from September 24 to October 4, 2024, where discussions focused on progress in reforms and the government’s policy priorities.
In a statement, Mr Roudet stated, “The IMF staff and Ghanaian authorities have reached a staff-level agreement on the third review of Ghana’s economic program under the Extended Credit Facility arrangement. This agreement is subject to IMF Management approval and Executive Board consideration. Upon completion of the Executive Board review, Ghana would have access to SDR 269.1 million (approximately US$360 million), bringing the total IMF financial support disbursed under the arrangement since May 2023 to SDR 1,441 million (about US$1,920 million).”
The statement highlighted that Ghana’s performance under the IMF-supported program has been generally satisfactory, with all end-June 2024 quantitative targets met. It noted that progress on key structural reforms has continued, despite some delays in certain areas.
The IMF’s policy and reform efforts have shown promising results. Economic growth in the first half of 2024 exceeded initial projections, largely driven by sectors such as mining, construction, and information and communication. Inflation has also continued to decline.
However, challenges remain. A recent dry spell affecting the northern regions is expected to negatively impact agricultural output, which could constrain growth and put upward pressure on food prices for the remainder of the year. Nevertheless, the government’s policy response is expected to mitigate these risks. Additionally, the Bank of Ghana is committed to maintaining a tight monetary policy stance to support the ongoing decline in inflation.
Fiscal performance in 2024 has remained strong, with Ghana on track to achieve a primary surplus on a commitment basis of ½ percent of GDP, despite emerging spending pressures from the drought in the northern regions and challenges in the energy sector.
Discussions with government authorities centered on enhancing energy sector sustainability and transparency, as well as strengthening revenue collections and expenditure controls in the lead-up to the December elections. The IMF also emphasized the importance of key social protection programs to safeguard vulnerable populations from the impacts of economic challenges and ongoing policy adjustments.
The IMF noted significant progress in Ghana’s public debt restructuring, having successfully restructured domestic debt last year and reached an agreement with Ghana’s Official Creditors Committee (OCC) under the G20 Common Framework in June. The government has also announced the successful completion of a consent solicitation to restructure its Eurobonds, with the exchange set to occur in the coming weeks.
The IMF commended the Ghanaian government for its commitment to engage in good-faith efforts to reach agreements with other commercial external creditors, ensuring treatment is consistent with program parameters and principles of comparability.
In 2024, Ghana’s external sector has shown considerable improvement, driven by strong exports—particularly gold, as well as increased remittances—resulting in international reserves accumulating beyond program targets. Financial stability has been maintained, with notable progress in bank recapitalization and profitability.
The IMF staff team met with Finance Minister Dr. Mohammed Amin Adam, Bank of Ghana Governor Dr. Ernest Addison, and various government representatives. The team also engaged with other stakeholders, expressing gratitude for the continued cooperation and constructive dialogue with the Ghanaian authorities.
