The International Monetary Fund is expected to extend Ghana’s three year program with the Fund after some targets under the bailout deal were missed by the previous government.
Ghana’s Minister of Monitoring and Evaluation, Dr. Akoto Osei told local radio station Citi Fm that the decision by the IMF followed a successful meeting by the IMF team and officials of the new government.
The IMF program was originally expected to end in April 2018 but has now been extended to December 2018. The extension contradicts government’s earlier stance that it will not seek for an extension of the program.
In 2016, Ghana’s overall fiscal deficit (on a cash basis) deteriorated to an estimated 9 percent of GDP, instead of declining to 5¼ percent of GDP as envisaged under the IMF-supported program. The large deviation was mainly due to poor oil and non-oil revenue performance and large expenditure overruns.
As a result, the government debt-to GDP ratio increased further to close to 74 percent of GDP at end-2016. Ghana’s senior minister Yaw Osafo Marfo told journalists in Accra on Tuesday that the program will be assessed after thorough examination of the benchmark under the program.
“The IMF program provides market support and confidence to a country and you don’t want to give investors wrong signals’ he said.
He added that “We must look at this things carefully to ensure government does not lose its market value, he target was to allow us to implement some of our new policies”.
Meanwhile the Civil Society Platform on IMF Bailout in Ghana has welcomed the decision by the IMF to extend the Program. Its Chairman Joe Winful tells Africafeeds.com that this will restore some international confidence in Ghana despite a change in government.
“We must look at some of the terms and condition to ensure we meet the targets this time around, he said.
The IMF in April 2015 approved a three year program for Ghana worth 918 million dollars aimed at putting the economy of the West African country back on track. Ghana has so far received 464.4 million dollars so far after three successful review under the program.
Source: Africafeeds.com/ Fred Dzakpata