$3bn IMF bailout: Ghana to receive 1st tranche by 2023 first quarter

The Finance Minister, Ken Ofori-Atta, has expressed confidence that Ghana will receive the first tranche of about $3 billion from the International Monetary Fund (IMF) by the first quarter of 2023.

According to the Minister, key fiscal measures, structural reforms, and the medium-term macro-fiscal framework in the 2023 Budget are aligned with the IMF-supported Programme.

Ghana has reached a Staff-Level Agreement on economic policies and reforms to be supported by a three-year arrangement under the Extended Credit Facility.

According to the Minister, more work is yet to be done to secure IMF board and management’s approval before the first tranche will be given to government, adding that the SLA is only one aspect of the approval process.

This, he called on all stakeholders, especially Parliament to ensure that, the 2023 budget and other revenue measures are passed in the house.

Asked during a joint press conference with IMF representatives in Accra on December 13, 2022, as to when the first tranche will be received, the Finance Minister, said, “Ghana stands ready to complete all the prior actions before the first quarter of 2023. We are committed to the programme as a whole and we will do our part to make it happen”.

“More is yet to be done to secure IMF board and management’s approval and that is what we all as Ghanaians should ensure that it goes through. Its therefore crucial we receive support from all stakeholders, especially Parliament to ensure that the 2023 budget and including all revenue measures are passed”.

Mr. Ofori-Atta urged Ghanaians to exercise restraint and be disciplined as the government waits for the IMF’s Board’s approval.

“We hope that Ghanaians will continue to support all efforts to restore macroeconomic stability and promote robust and inclusive growth. vii. We are confident as a resilient people, and we shall rally to this great enterprise, to restore macroeconomic stability and promote robust and inclusive growth. The world is looking at us, and I know we can do it. viii. To God indeed be the glory for the great thing he hath done
within 5 months.  x. Let us continue with courage, the spirit of love for each other and self-discipline to go through this together,” the Finance Minister said.

The Finance Minister added that the whole programme will be successful if the government gets commitment from its creditors.

“We can only get to the IMF Board if we get sufficient commitment from our creditors in support of the debt operation. i. The 2023 Budget is anchored on increasing domestic revenue mobilization effort by 1.2 percentage points of GDP. On the expenditure side, the 2023 Budget proposes to reduce expenditures (on commitment basis) by about 2 percentage points of GDP from 2022 to 2023. Primary expenditures are expected to be reduced through a reduction in allocation on the Use of Good and Services and Domestically Financed Capital expenditure on a commitment basis,” the Finance Minister said.

This, the Finance Minister said, “These fiscal adjustments alone are not enough to address the country’s economic challenges, hence the ongoing debt restructuring aimed at restoring debt sustainability in the medium-term”.

On his part, the IMF Mission Chief for Ghana, Stephan Roudet said, “We have been engaging very closely with Ghana and I’m extremely pleased to announce that the IMF has reached the staff agreements with Ghana”.