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IMF Reaches Staff-Level Agreement with Ghana for US$370 Million DisbursementThe International Monetary Fund (IMF) has announced a staff-level agreement with the Government of Ghana following the fourth review of the country’s Extended Credit Facility (ECF) programme. Once approved by the IMF Executive Board, the agreement will unlock a further disbursement of approximately US$370 million.
The announcement follows a two-week mission in Accra, led by IMF Mission Chief, Stéphane Roudet, and comes at a time when Ghana is showing signs of economic recovery despite challenges posed by the 2024 election period.
“IMF staff and the Ghanaian authorities have reached a staff-level agreement on the fourth review of Ghana’s economic programme under the Extended Credit Facility arrangement,” Mr Roudet stated in a release dated 15 April. “Upon completion of the Executive Board review, Ghana would have access to SDR 267.5 million (around US$370 million), bringing total disbursements under the arrangement since May 2023 to about US$2.355 billion.”
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Growth in mining and construction drives economic recovery
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According to the IMF, Ghana’s economy performed better than expected in 2024, primarily due to a strong showing in the mining and construction sectors. External conditions also improved, supported by a surge in gold exports, rising remittances, and a healthy accumulation of foreign reserves.
However, the IMF cautioned that these positive indicators were overshadowed by a significant decline in the overall performance of the ECF programme towards the end of 2024.
Preliminary fiscal data point to slippages in the run-up to the 2024 general elections, including a large accumulation of payables. Inflation exceeded programme targets, and several policy reforms were delayed,
Government responds with bold fiscal reforms
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In response to the programme's setbacks, Ghana’s new leadership has implemented robust corrective measures aimed at restoring fiscal discipline. These include the introduction of a 2025 budget targeting a primary surplus of 1.5% of GDP, in contrast to the previous year’s deficit exceeding 3%.
The government has also rolled out public financial management reforms, including tighter controls on expenditure and the establishment of an enhanced fiscal responsibility framework.
The authorities have enacted a 2025 budget that targets a 1½% of GDP primary surplus and adopted several public financial management reforms. This includes an enhanced fiscal responsibility framework and new rules to tighten expenditure commitments.
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The IMF welcomed the Bank of Ghana’s decision to raise its policy rate, praising the tightening of monetary policy and ongoing fiscal consolidation as critical steps toward curbing inflation.
Reforms in the energy sector were also noted. The reinstatement of quarterly electricity tariff adjustments, along with broader structural reforms, is expected to reduce the sector’s fiscal pressures and halt the accumulation of arrears.
The IMF mission also reviewed efforts to improve governance and operational efficiency across state-owned enterprises, especially in the cocoa, gold, and energy sectors.
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Ghana’s ongoing debt restructuring efforts were praised. The country has signed a Memorandum of Understanding with the Official Creditors Committee under the G20 Common Framework, and bilateral arrangements are being pursued. Talks with commercial creditors continue, adhering to the IMF’s comparability of treatment principles.
During the mission, the IMF team held discussions with Finance Minister Dr Cassiel Ato Forson, Governor of the Bank of Ghana Dr Maxwell Opoku-Afari, and other senior government officials and stakeholders.
The Fund expressed appreciation for Ghana’s “continued open and constructive engagement” as the country seeks to stabilise its economy and restore fiscal and debt sustainability.