IMF Will Not Release $600m To Ghana Unless Govt Secure Agreement With Creditors

The International Monetary Fund (IMF) has told the government of Ghana that it will only release the next $ 600 million tranche of the $3 billion bailout package after the government secures an agreement with its bilateral creditors.

According to the Bretton Woods Institution, even though, the government has reached a staff level with the Fund, securing agreements with its bilateral creditors is crucial.

In a post on X (Twitter) on Wednesday the IMF boss Kristalina Georgieva urged the government to immediately continue engagements with the aforementioned creditors.

“Great to meet GH @MoF_Ghana Min Ofori-Atta & @thebankofghana Gov Addison at #IMFMeetings. Congrats on the recent staff-level agreement on the Fund-supported program’s first review.”

“Counting on bilateral creditors reaching agreement on debt relief soon to move the review forward,” she posted.

Meanwhile, the Ministry of Finance also in post on the same platform has appealed to its bilateral creditors to quickly agree on current debt relief terms to enable Ghana to secure the second tranche of the package from the IMF.

“Grateful for strong IMF support, and calling on bilateral creditors to agree on debt relief terms as quickly as possible,” the Ministry posted on its X (Twitter) handle.

Last week, Ghana reached a staff-level agreement with the IMF for a release of a second 600 million dollars under the 3bn IMF bailout.

Following this, Finance Minister Ken Ofori-Atta said the development was a sign that the economy was seeing a rebound and recovering.

But this has been disputed by some Ghanaians including the Minority in Parliament.

According to Minority Spokesperson on Finance, Isaac Adongo, all the key economic indicators like inflation, interest rates and economic growth have all worsened compared to where they stood last year.

“The data is quite clear that the situation is worse today than it was last year and yet we would want to believe that last year was the worst period; that after the IMF in 2023, it will get better than last year, but the data suggests otherwise.

“What they have sought to do is to compare mangoes with pineapples. You can’t take end of year inflation of 2022, and compare it to any of the inflations other than December 2023. That is how you compare apples to apples. Because the inflations that you find during any period, year-on-year are compared to the same period the previous year and we are not in December.”

Mr. Adongo added “The inflation we are seeing today has different season pressures compared to December. In December we all know the demand pressures, we know Christmas comes and there is a lot of pressure on the cedi because people are looking for foreign currencies to stock for Christmas and the inflation as of now has not experienced that, so you cannot compare that to the inflation that will be attained in December.”

“Again, you cannot compare food inflation in the period of harvest to food inflation in the period of planting”.