We’re determined to reach an agreement with Ghana by end of 2022 – IMF boss

Ghana is said to be targeting an amount of $3 billion over three years from the Fund once an agreement on a programme is reached. The new amount requested as a loan was double the government’s initial target of $1.5 billion.

In a related development, Kristalina Georgieva said constructive discussions have been held with Ghanaian authorities for a possible economic support programme.

“The people of Ghana just like other countries on the planet have been hurt by these external shocks such as the COVID-19 pandemic and Russia’s invasion of Ukraine and we all need to realise that the ongoing challenges are not due to bad policies in Ghana but because of a combination of these economic shocks and therefore we [IMF] have to support Ghana,” she said in an interview with Accra-based Joy News.

The IMF boss further touted Ghana’s social, political and economic credentials which she says can positively impact neighbouring countries.

Touching on whether Ghana can secure its revised target amount of $3 billion from an initial $1.5 billion, Kristalina Georgieva said, “We have to go through with the discussions and then we will know”.

Meanwhile, global investment and research firm, Goldman Sachs, has said there is a lack of urgency on the part of the Government of Ghana to secure an economic support programme from the International Monetary Fund.

In a recent guidance note to investors, the reputable firm said the ‘no sense of urgency’ verdict was due to the continuous delay in getting a deal on time, which could then force the Bank of Ghana (BoG) to increase its deficit financing of the budget.

Goldman Sachs in August this year noted: “In our recent trip to Accra, one notable observation was the authorities’ perceived lack of urgency in concluding programme talks with the IMF (with locals expecting a six to nine-month timeframe), despite intensifying balance of payments (BoP), FX and fiscal financing pressures.”

“We have argued that a delayed conclusion creates the risk of further deficit monetisation by the BoG, cedi depreciation and a decline in FX reserves, implying that the macroeconomic outlook may deteriorate further in the near term,” the investment and research firm said.

Goldman Sachs further pointed out that the intense pressure on the Ghana cedi and government’s inability to finance its budget deficit could further increase the sense of urgency which could prompt government to fast-track bailout engagements with the IMF.

Ghana in July this year decided to seek financial support from the International Monetary Fund to restore macroeconomic stability and safeguard debt sustainability.