$3bn IMF loan: Ghana at advanced stage – Finance Minister

Mr Ken Ofori-Atta, Minister of Finance, says Ghana has made significant success to secure an Executive Board approval from the International Monetary Fund (IMF) by the close of May 2023.

He said that Ghana had adopted a proactive stance to restore economic and fiscal sustainability.
Mr Ofori-Atta said this when he addressed Eurobond holders at an investor presentation on the side-lines of the 2023 IMF/World Bank Group Spring Meetings in Washington DC, US on Wednesday.

He said though the country was severely impacted by economic shock of 2020 (COVID-19) and 2022 (Russia-Ukraine war), Government’s decisive steps had positioned the country to restore macroeconomic stability to spur growth.

“We have made significant efforts on all fronts. We hope we could reach an agreement in principle with you, our Eurobond holders quickly,” the Finance Minister said.

He said the Government hopes to sign a Memorandum of Understanding (MoU) with external creditors in principle on terms for the restructuring of Eurobonds by May 2023, leading to securing an Executive Board approval by the end of second quarter of this year.

The external debt restructuring exercise, Mr Ofori-Atta said was necessary to restore debt sustainably, ensure the full financing of the IMF programme and gain access to the capital market.

“We understand this is a challenging time for all of you to commit and offer a financial support. But please be assured we’re fully committed to you and your advisors to ensure equitable solution.”

Since announcing initiation of talks with the Fund nine months ago, Ghana reached Staff-Level Agreement on a US$ 3bn arrangement under the Extended Credit Facility and completed a Domestic Debt Exchange Programme (DDEP).

It has applied to the G20 Common Framework for Debt Treatment as it seeks to complete debt treatment with bilateral and multilateral creditors as well as private and commercial creditors.

When secured, the $3bn loan facility would undertake growth-friendly and lasting fiscal adjustment reforms to restore public debt sustainably while protecting the vulnerable in society.

The three-year IMF-support programme is to also help Preserve the external buffers and financial stability, bolster the efficiency of monetary policy, improve governance and transparency of the public sector, and foster entrepreneurship and growth.