Seth Terkper Outlines Plans For Smart Borrowing and Debt Management in IMF Renegotiation
Former Finance Minister Seth Terkper has disclosed that President-elect John Mahama’s intention to renegotiate Ghana’s International Monetary Fund (IMF) programme is rooted in a strategy to reset the economy and address prevailing challenges.
Speaking on PM Express Business Edition with George Wiafe on December 12, 2024, Mr. Terkper explained that the renegotiation will focus on aligning the IMF programme with Ghana’s current economic realities and fast-tracking measures to stabilize the economy.
“Our plans to renegotiate have also been influenced by the current state of the economy and how the John Mahama administration wants to fast-track measures to fully stabilize the economy,” Mr. Terkper said.
Key Areas of Focus
He indicated that the renegotiation will address the country’s Primary Balance, debt management, and fiscal consolidation. The incoming government plans to implement “smart borrowing” strategies to manage Ghana’s debt burden and finance costly obligations.
“When you look at the current debt situation and the expected payments from 2025, the incoming NDC government has to explore innovative ways to finance these debts,” he noted.
The renegotiation will also evaluate key benchmarks and fiscal measures under the programme to ensure they align with Ghana’s economic priorities.
Background
President-elect John Mahama recently informed United Nations Resident Coordinator Charles Abani of his administration’s commitment to reviewing Ghana’s agreements with the IMF and World Bank.
The $3 billion IMF Extended Credit Facility, which spans 36 months, has been pivotal to Ghana’s financial stability, alongside other agreements like the $250 million Ghana Financial Stability Project and the Ghana Energy Sector Recovery Programme.
“This adjustment is crucial and will help put the new government that would be inaugurated next year on the same springboard with our development partners to begin the rebuilding of the economy and the country,” President-elect Mahama stated.
Investor Engagements
Addressing potential concerns about investor confidence, Mr. Terkper dismissed fears of negative reactions.
“We have done our engagements and are still engaging these investors on their concerns that will be factored in these re-negotiations,” he said.
He revealed that discussions with development partners are ongoing, and a National Consultative Forum on the Economy will provide a platform to address all stakeholder concerns, including the IMF programme review.
The Mahama administration appears poised to leverage these negotiations as a cornerstone of its broader agenda to revitalize the economy.
