According to Mohammed Amin Adam, Minister of State in the Finance Ministry, Ghana expects the IMF to approve a $600 million loan tranche on Wednesday, allowing disbursement within a week.
Ghana is seeking $3 billion from the Fund to help revitalize its economy. IMF Managing Director Kristalina Georgieva said on Friday that Ghana’s official creditors had provided the financing assurances needed for the IMF Executive Board to consider the loan.
We anticipate a deal on Wednesday. Adam stated over the phone that Ghana expected to receive the first tranche of $600 million within a week of the board’s approval.
Following a successful first review of the program in November or December, a second tranche of $600 million will be approved, with the remainder distributed in equal $360 million tranches following semi-annual reviews.
He stated that the funds will assist Ghana in meeting its goal of having three months’ worth of imports in foreign reserves by 2026.
Ghana, like other riskier emerging markets such as Sri Lanka and Zambia, is facing a debt restructuring as a result of COVID-19 and Russia’s invasion of Ukraine.
Government data show that $5.4 billion in official debt and $14.6 billion in private overseas debt will be restructured.
After the IMF approves the loan, Adam anticipates smooth negotiations with both sets of creditors.
“Confidence will be restored, and we expect stakeholders to cooperate and be encouraged to negotiate favorable terms with us,” he said, adding that no meetings had been scheduled.
Ghana has also turned to the World Bank to help it overcome its worst economic crisis in a generation and put an end to protests over rising living costs.
Adam stated that the government was on the verge of obtaining $900 million from the World Bank in three $300 million installments spread over three years.
“We are far advanced, almost to the point of concluding negotiations,” he said.
A $250 million World Bank financial sector stability fund will assist Ghana in addressing insolvency and liquidity issues caused by a domestic debt exchange program that affected some domestic banks.
Adam stated that the government was also negotiating a $100 million stability fund with the African Development Bank.
