IMF welcomes Ghana’s debt treatment agreement with external creditors

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Ms Kristalina Georgieva, MD, IMF

The International Monetary Fund (IMF) has welcomed Ghana’s agreement with its Official Creditors.

 

This move paves the way for the IMF to review Ghana’s extended debt facility in a bid to disburse the next tranche of the $3 billion facility.

 

In a statement issued after the announcement by Ghana’s Finance Ministry, Ms. Kristalina Georgieva, Managing Director of the International Monetary Fund, said: “I welcome Minister of Finance Ofori-Atta’s announcement that the Ghanaian authorities have reached an agreement in principle with their official creditors on a debt treatment, consistent with the objectives of the IMF-supported program, which aims to restore macroeconomic stability and debt sustainability, build resilience, and lay the foundations for stronger and more inclusive growth.”

 

“I want to thank the Official Creditor Committee, especially the co-chairs, China and France, for all their work to reach this agreement. This is another substantial milestone for the G20 Common Framework under which G20 creditors joined forces to agree on debt relief for Ghana.

 

“This agreement clears the path for IMF Executive Board consideration of the first review of Ghana’s three-year Extended Credit Facility Arrangement in the next few days. I look forward to continuing our fruitful collaboration with Ghana.”

 

Ghana’s second tranche of bailout journey

The Government of Ghana on Friday announced that it has reached an agreement with its Official Creditors in restoring debt sustainability in line with the IMF programme targets.

 

The government is seeking to secure the 2nd tranche of the IMF bailout after securing the 1st tranche in 2023.

 

The government embarked on a Domestic Debt Exchange Programme (DDEP) in 2023, towards restoring Ghana’s long-term debt sustainability.

 

The Ministry of Finance in a statement dated January 12, 2024, explained that the agreement was under the G20 Common Framework, ‘on a Comprehensive Debt Treatment Beyond the Debt Service Suspension Initiative’.

 

The government expressed confidence that the debt treatment, which entails significant flow relief during the programme period, ‘will allow for the allocation of additional financial resources towards critical public investments’.

 

“The Government of Ghana commends the support and cooperation of its Official Creditors in reaching this agreement, which demonstrates a mutual commitment to restoring debt sustainability in line with the International Monetary Fund (IMF) programme targets. The Government is confident that this debt treatment, which entails significant flow relief during the programme period, will allow for the allocation of additional financial resources towards critical public investments.”

 

Source – CNR

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