International Monetary Fund to release final tranche of 185 million under ECF programme with Ghana

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Ghana is expected to receive the last disbursement under its 4-year Extended Credit Facility (ECF) programme with the International Monetary Fund, following a final review.

The Board of the Fund has set March ending to complete the review process which will pave way for the disbursement of $185.2 million to Ghana, whose major exports include cocoa and gold.

The ECF-supported programme paved the way for a significant improvement in Ghana’s macroeconomic performance, though challenges remain.

Considering Ghana’s resolve to tackle difficult reforms, the Executive Board also approved the authorities’ request for a waiver of the nonobservance of a few programme targets.

Ghana’s three-year arrangement was approved on April 3, 2015 for SDR 664.20 million (about US$925.9 million or 180 percent of quota at the time of approval of the arrangement).

It was extended for an additional year on August 30, 2017 and is to end on April 2, 2019.

The arrangement aimed to restore debt sustainability and macroeconomic stability in the country to foster a return to high growth and job creation, while protecting social spending.

Following the Executive Board’s discussion, IMF’s Deputy Managing Director and Acting Chair, Tao Zhang said, “The authorities have achieved significant macroeconomic gains over the course of the ECF-supported program, with rising growth, single digit inflation, fiscal consolidation, and banking sector clean-up. Continued macroeconomic adjustment should underpin these improvements, as the 2020 elections approach.

“In a sign of the authorities’ commitment to fiscal consolidation, the end-2018 fiscal targets were met. Sustained fiscal discipline is needed to reduce financing needs and anchor debt dynamics. As stronger revenue mobilization is critical, the submission of the tax exemption bill is welcome, but needs to be complemented by efforts to strengthen tax compliance. Fiscal space is needed to support priority programs, while off-budget expenditures should be avoided.”

He added, “Progress on structural reforms needs to be intensified. Plans to improve public financial management and supervision of state-owned enterprises (SOEs), the establishment of a fiscal council, and the fiscal rule are welcome. Stronger monitoring of fiscal operations, including for SOEs, will help mitigate fiscal risks.”


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