The Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, has expressed her support for the agreement reached between Ghana and its Official Creditor Committee (OCC), which she believes will aid in the approval of the country’s $360 million third tranche.
In a social media post on Wednesday, Georgieva congratulated Ghana, stating that this agreement “will support the IMF Executive Board’s consideration of the program’s second review later this month.”
This development follows the Ministry of Finance’s announcement on the restructuring of approximately $13 billion in external debt, marking a significant step towards restoring long-term debt sustainability for Ghana.
Finance Minister Dr. Mohammed Amin Adam emphasized that this agreement will enhance ongoing discussions with private creditors to reach a comparable agreement soon.
“This landmark agreement marks an extraordinary milestone in Ghana’s debt restructuring journey and will further strengthen our ambitious reform agenda with the strong support of our development partners,” Dr. Amin Adam said.
In an interview with the Ghana News Agency, economist Professor Godfred Alufar Bokpin described the agreement as a “major breakthrough” in the country’s debt restructuring process.
He indicated that the Memorandum of Understanding (MoU) should be finalized by the end of this month, paving the way for the IMF Executive Board to approve the second review and release the third tranche of $360 million.
“There’s reasonable certainty that by the end of the month, we should be getting the third tranche, and it’s good news, but that’s not what will solve all the problems,” Professor Bokpin noted.
He stressed the importance of intensifying reforms to address structural issues, including inflation and exchange rate pressures, to consolidate and sustain the gains made.
Reflecting on previous IMF loan support programs, Professor Bokpin warned against complacency in the third review process while urging the media, academia, and Civil Society Organisations (CSOs) to maintain pressure on the government to ensure it meets structural benchmarks and maintain fiscal responsibility, especially during the upcoming election period.
“The third review, which will happen towards the latter part of this year and coincide with the election season, poses a risk. That’s where we need to focus our attention,” he said.
He highlighted the tendency of past governments to neglect the review process during election cycles and urged the current administration to enforce stricter fiscal policies to prevent excessive expenditure.v
