The International Monetary Fund (IMF) approved on Monday a further 191 Million US Dollars as part of its three-year support program to government of Ghana, a release received here early Tuesday has said.
This approval followed the completion of the Fifth and sixth reviews of Ghana’s performance under the program which started in April 2015.
The three year program was designed to help Ghana keep its debt levels under control while other basic economic factors were stable to ensure high economic growth and job creation.
Including the latest fund release the IMF has so far supported the West African cocoa, gold and oil expoting nation with 764.1 million dollars out of a promised 955.2 million dollars or 664.20 Special Drawing Rights (SDR).
“During the review, adjustments were made to the program to ensure that it remains on track and to enhance its prospects of success. In this context, the Executive Board also granted waivers, including for deviations in a few program targets,” the release disclosed.
Tao Zhang Acting chairman and Deputy Managing Director of the IMF expressed hope after the the Executive Board’s discussion on Ghana that the country’s economic managers will successfully complete the support program during the year.
He pledged IMF ‘s readiness to support the country in future.
Implementation of the Extended Credit Facility ( ECF)-supported program, the deputy managing director observed had brought significant improvement into the economy in 2017.
“Growth has rebounded, the fiscal deficit has declined, leading to a primary surplus for the first time in fifteen years, the external position has strengthened, generating a build-up of external buffers, ” he noted.
Zhang commended the country’s leaders for their commitment to a disciplined spending regime which helped the government to lower its rate of overspending last year.
“The government should continue to implement its fiscal consolidation program, with the adjustment focused mainly on increased domestic revenue mobilization,” he urged.
The recent announcement to introduce new tax measures during the mid-year budget review in July he said was welcome news, as such measures are needed to ensure that Ghana’s financial management remained sustainable over time.
However, as the debt burden remained high, the IMF official emphasised the need for continued innovative debt management in order to reduce the risks associated with borrowing from profit seeking financial institutions instead of borrowing from sources where the conditions are softer.
The deputy IMF Managing Director also urged Monetary policy managers (Bank of Ghana) to keep working hard towards achieving the medium term inflation target of eight percent,plus or minus two percentage points.
Although the initial agreement was for the ECF country program to end in April, government negotiated for a year’s extension. Enditem