Speaking on Asempa FM’s Ekosii Sen show, Mr. Kwakye Ofosu said that between 2023 and 2024, the NPP government increased power tariffs by 52 percent as part of IMF-backed conditions.

He noted that the agreement required quarterly tariff adjustments and major reviews to account for inflation, production costs, and exchange rate pressures.

According to him, a significant tariff adjustment made around September or October last year was aimed at improving electricity access and supporting capital expenditure in power generation.

“Between 2023 and 2024, under the NPP, power prices were increased by 52%. As part of the conditions set by the IMF, the government agreed to implement quarterly tariff adjustments and a significant tariff review to recover costs related to inflation, production expenses, exchange rates, and other factors.

“Last September or October, we carried out a major tariff adjustment based on improvements in access to electricity and capital expenditures for power generation, which the NPP had consented to. The IMF collaborates with the government, and once an agreement is made, it must be honoured. This is a binding agreement established by the NPP with the IMF. Such measures are necessary; otherwise, we would continue to accumulate debt,” he stated.

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Speaking at the Ghana–Zambia Business Dialogue in Lusaka on Friday, February 6, President Mahama highlighted easing inflation, stronger foreign reserves, and renewed investor confidence as evidence of the country’s economic recovery following recent fiscal reforms.

He noted that the stabilising economy positions Ghana to expand trade and investment, particularly under the African Continental Free Trade Area (AfCFTA).

“These gains provide a solid foundation for Ghana’s development agenda, which focuses on five strategic pillars: industrialisation and value addition; export-led growth; modern infrastructure development; strong support for MSMEs, women and youth entrepreneurs; and a predictable, transparent, and investor-friendly business environment,” President Mahama stated.

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According to the IMF, the extension is needed to allow for the implementation of reforms underpinning the sixth and final review of the programme.

This was disclosed in the IMF Staff Report released after the Fund’s Executive Board approved Ghana’s fifth programme review.

If accepted, the proposal will extend Ghana’s ECF programme, which was scheduled to end in May 2026, to August 2026.

In the report, the IMF noted that “the extension through August 16, 2026, would help reach an understanding on the policies supporting completion of the 6th review, while allowing sufficient time to prepare and circulate Board documents.”

Proposed programme modifications

The IMF is also proposing modifications to Ghana’s programme, including changes to the Indicative Targets (ITs) and the Monetary Policy Consultation Clause (MPCC).

The Fund explained that at the end of March 2026, the primary balance and non-oil revenue ITs will be modified to accommodate macroeconomic developments, while maintaining the fiscal effort relative to GDP.

In addition, the MPCC bands for December 2025 and March 2026 are expected to be adjusted downward to reflect better the impact of recent macroeconomic developments on expected disinflation trends.

Programme status

Ghana’s 36-month ECF arrangement was approved by the IMF’s Executive Board in May 2023, with access amounting to 303.8 per cent of quota, equivalent to SDR 2.2419 billion, or about US$3 billion.

So far, Ghana has secured about US$2.8 billion following the successful completion of the fifth programme review.

The IMF said Ghana’s programme implementation has been broadly satisfactory, noting that all end-June 2025 performance criteria and indicative targets were met.

The Fund also disclosed that three prior actions were completed for the fifth review. These include the audit of 2024 payables, the cleansing of the taxpayer registry and ledger data, and the submission of the 2026 budget to Parliament in line with programme objectives.

There has also been progress on previously missed structural benchmarks from the fourth review. The IMF said the strategy for state-owned banks, which was initially due in April 2024, was implemented in September 2025.

The Fund further praised the authorities for progress in operationalising indicative targets, which have been rephased in three stages. The first stage covers key aspects of the missed structural benchmarks and has been reset as a new end-March 2026 structural benchmark.

Out of the eleven structural benchmarks for the current ECF review, the IMF said four were met, two were implemented with delays, one was implemented as a prior action, one is expected to be implemented in December 2025, and three were missed.

The IMF noted that the end-June 2025 structural benchmark on merging certain statutory funds with their line ministries was not met, as the authorities opted for an alternative approach to achieve the programme’s objective of reforming earmarked funds.

Challenges and risks

Despite the progress made under the programme, the IMF expressed concern about Ghana’s economic outlook.

According to the report, “the macroeconomic outlook remains generally positive though subject to significant downside risks.”

The Fund said these risks mainly stem from potential deterioration in the external environment, particularly commodity price volatility, as well as confidence effects arising from policy and reform slippages.

It also warned that delays in completing Ghana’s comprehensive debt restructuring pose additional risks.

The IMF further highlighted Ghana’s vulnerability to regional conflicts, terrorism, geoeconomic fragmentation, commodity price volatility, and trade and investment shocks.

Domestic policy slippages, the Fund cautioned, could undermine macroeconomic stability and debt sustainability, complicating engagements with external creditors and development partners.

The IMF also pointed out that delays in implementing the Energy Sector Recovery Programme could require additional budgetary resources and trigger electricity and fuel supply disruptions.

Debt classification

While acknowledging Ghana’s progress in reducing total debt and securing restructuring agreements with some bilateral creditors, the IMF said it still considers the country to be at high risk of debt distress.

Although all debt sustainability indicators remain below their respective thresholds under the baseline scenario, the Fund said it applied judgment to maintain the high-risk classification.

According to the IMF, this reflects significant uncertainties around commodity prices and exchange rate movements, as well as elevated rollover risks and independent power producer payment obligations.

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According to him, the country is currently ahead of most of the targets and benchmarks under the IMF programme.

The Governor noted that Ghana has worked hard to undertake the necessary reforms to firmly stabilise the economy.

Dr Asiama gave the assurance during an interaction with the IMF’s Director of the African Department, Abebe Selassie, on the sidelines of the IMF/World Bank Annual Meetings in Washington DC.

The discussion formed part of the “Governor Talks Series” organised by the IMF, focusing on Ghana’s recent macroeconomic journey—marked by external shocks, fiscal vulnerabilities, and a challenging global environment.

The Governor’s assurance comes at a time when there have been reports suggesting that the country could be forced to extend the IMF programme to give investors and development partners confidence in government’s commitment to fiscal discipline.

However, Dr Asiama’s remarks appear to calm such fears.

“We should not forget that when this administration took over, there were concerns that we should cancel the programme, and there were doubts about whether we could carry on with it,” he said.

“But the current developments show that we have delivered and turned things around,” he added.

He further noted that “the current ECF programme has also introduced a lot of structural reforms, including those designed to strengthen the Bank of Ghana’s operational capacity and its monetary policy framework.”

Ghana signed up for the IMF programme in 2023, which is expected to end in May 2026. According to the Fund, it has already advanced more than US$2 billion to support Ghana’s economic recovery.

Dr. Asiama also praised the IMF for the support it has provided to help stabilise the economy.

Ghana’s Economic Recovery

The Governor highlighted some of the drastic measures undertaken by both fiscal and monetary authorities to stabilise the economy.

“We met an economy that was challenged, with high levels of inflation, and this was our priority when this administration took over,” he said.

Dr. Asiama added that the Bank of Ghana worked hard to tighten monetary policy and step up liquidity management.

He revealed that following the high inflation levels experienced in 2023 and 2024, the central bank moved swiftly to raise the policy rate and strengthen liquidity controls.

“These measures have helped to reduce inflation to 9.4 per cent as of September 2025,” he said.

“Our policies, going forward, will be data-driven and adaptable to changes in the economy,” the Governor added.

On sustaining the current inflation levels, Dr Asiama emphasised that “now that inflation is within the target band, the challenge is to sustain the gains by continuing to implement sound monetary and exchange rate policies to ensure inflation remains within target.”

He also highlighted the critical role of Ghana’s Gold for Reserves programme, saying it has yielded positive results and enabled the Bank of Ghana to build its reserves.

Exchange Rate Framework

Dr Asiama disclosed that, in collaboration with the IMF, the Bank of Ghana has developed a structured foreign exchange operations framework to intermediate FX flows and smooth excessive market volatility while building international reserves.

“As these framework changes take place, they will bring further transparency to our foreign exchange market operations and help ease volatilities in the market,” the Governor said.

Source: George Wiafe

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The full mission team, led by Mission Chief Stéphane Roudet, arrived in Accra over the weekend. They will spend two weeks in the country engaging the technical staff of the Ministry of Finance and the Bank of Ghana.

The team will also meet with the Governor of the Bank of Ghana, Dr Johnson Asiama, and the Minister of Finance, Dr Ato Forson.

Sources tell Joy Business that unresolved arrears clearance issues will be a key focus of discussions, as government is yet to complete its audit on last year’s spending on construction and projects.

Concerns are also expected over whether the Bank of Ghana’s recent policy rate cuts are adequate given the sharp fall in inflation, as well as questions regarding reserve build-up and dollar interventions.

This review is the penultimate one before Ghana concludes the IMF programme in May 2026, with the final review scheduled for April 2026. Analysts describe the current assessment as crucial, warning that Ghana may struggle to maintain fiscal discipline once the programme ends.

Some donor partners are therefore pushing for “shock absorbers” to ensure stability beyond the IMF exit.

Government, however, insists there is no cause for concern, maintaining that measures are already in place to ensure disciplined expenditure after the programme.

If Ghana passes this review, the country is expected to receive about $360 million in October 2025, bringing total disbursements so far to about $2.3 billion since the programme began.

The review will assess economic data up to June 2025, with discussions focusing on inflation trends, reserve sustainability, arrears audits, weak private banks requiring recapitalisation, the state of state-owned banks, revenue shortfalls, arrears build-up in statutory funds, and gaps in social spending.

The IMF Executive Board approved Ghana’s $3 billion Extended Credit Facility in May 2023. The programme aims to restore fiscal sustainability through revenue mobilisation and efficient spending, protect the vulnerable, implement structural reforms in tax and energy, and preserve financial stability.

It also seeks to curb inflation, rebuild reserves under a flexible exchange rate regime, and create conditions for private investment, growth, and job creation.

Source: Joy Business

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According to the IMF, the new government has expressed strong support for reforms under the ongoing IMF-supported programme.

The Fund stated that “the authorities [Mahama government] see the latter [Akufo-Addo government] as having played a key role in stabilising the economy and in providing a credible anchor to address long-standing vulnerabilities and buttress confidence.”

This revelation comes just days after a heated exchange in Parliament between Majority and Minority members over Ghana’s recent economic gains, including declining inflation and a strengthening cedi.

The National Democratic Congress (NDC) credited Ghana’s recent macroeconomic gains to legacy policies initiated under former President John Mahama.

Amenfi West MP, Eric Afful pointed to falling inflation, dropping from 21.2% in April to 18.3% in May 2025, alongside a stronger cedi and improved fiscal indicators as evidence of this legacy. He attributed the progress to tight monetary policy, fiscal consolidation, and improved market confidence.

However, Ofoase-Ayirebi MP, Kojo Oppong Nkrumah challenged these claims, arguing the cedi’s rebound is largely due to short-term interventions, including a 1.4 billion dollar injection from reserves, which he says do not reflect long-term economic strength.

Other lawmakers echoed concerns about the sustainability of the gains. Energy Minister John Jinapor cautioned that while inflation has declined, prices are still rising, a case of disinflation, not deflation.

Dr. Kabiru Mohammed warned that the cedi’s appreciation, driven by central bank interventions, creates an illusion of economic strength and contradicts market principles.

He also disputed the improved debt-to-GDP ratio, attributing it more to debt restructuring than actual growth. He stressed that the current administration is reaping the benefits of reforms it did not initiate.

Isaac Kofi Agyei, JoyNews Research

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The IMF described the country’s programme performance as having “deteriorated markedly” by the end of 2024.

This was revealed in the Fund’s update following the completion of Ghana’s Fourth Review, which also approved the disbursement of $367 million, bringing the total amount disbursed under the programme to approximately $2.3 billion.

The Fund acknowledged that while Ghana recorded stronger-than-expected economic growth and saw a significant improvement in its external position in 2023, programme implementation suffered setbacks heading into the election year.

“This reflected pre-election fiscal slippages; inflation above program targets—though recent data point to renewed rapid disinflation; and reforms delays. ,” the IMF stated.

Following the Executive Board’s assessment, Deputy Managing Director Bo Li noted that the programme had deviated substantially from its targets by the close of 2024.

“Faced with large policy slippages and reform delays at end-2024, the new administration has taken bold corrective actions to maintain the program on track,” he said.

According to the IMF, these corrective actions, when combined with continued structural reforms and an improved external sector, are expected to help Ghana achieve its broader goals of economic stabilization, resilience building, and inclusive growth.

Meanwhile, Ghana’s macroeconomic outlook has shown signs of recovery. The cedi has appreciated by more than 30% against the US dollar, and inflation has declined sharply to 13.7% as of the end of June. The country’s Gross International Reserves have also surged, now covering over four months of imports.

One of the most notable improvements is the upgraded outlook on Ghana’s Long-Term Foreign-Currency Issuer Default Rating (IDR), a signal of rising investor confidence.

Government sources say discussions are ongoing to return to the International Capital Market, following the successful reopening of domestic bond issuances.

Source: Isaac Kofi Agyei, JoyNews Research

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During a meeting with the German Ambassador to Ghana, Daniel Krull, Dr. Forson acknowledged that Ghana had previously missed some structural benchmarks under the IMF programme but assured that steps are being taken to address the gaps.

“We have taken concrete steps to correct the structural benchmarks that were missed under the previous government, and the results will soon be evident,” he stated.

On Ghana’s ongoing debt restructuring, Dr. Forson highlighted the significant progress made and stressed that the focus is now on finalizing bilateral agreements with external creditors.

He called for Germany’s support in expediting the process, emphasizing that securing these agreements is critical for Ghana’s economic recovery.

Ambassador Krull commended the government’s efforts, describing the discussions as insightful. He also reaffirmed Germany’s readiness to proceed with signing the necessary bilateral agreements to support Ghana’s financial stability.

Ghana’s collaboration with the IMF is part of broader efforts to restore macroeconomic stability and ensure sustainable growth. The government remains optimistic that ongoing reforms and international support will help place the country on a stronger economic path.

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Speaking at a Minority press conference, Dr. Boako clarified his stance, stating that he has never made such a claim and that the matter has been misrepresented.

“I have never said anywhere that scrapping the betting tax and e-levy will be in violation of the IMF programme,” Dr. Boako insisted.

He explained that the decision to remove these taxes aligns with the New Patriotic Party’s (NPP) manifesto promise, which was championed by the party’s flagbearer, Dr. Mahamudu Bawumia.

According to him, the NPP is committed to fulfilling this pledge as part of its vision for economic relief and tax reform.

Dr. Boako further highlighted that Dr. Bawumia has consistently opposed taxes of this nature, referencing a 2020 interview on Peace FM where the NPP leader shared his views against the e-levy.

He stressed that the party’s stance is rooted in its long-standing policy positions, not in any potential conflict with the IMF programme.

The Tano North MP reiterated the importance of honouring campaign promises, particularly those aimed at easing the financial burden on citizens.

He called on stakeholders to focus on the broader objectives of Ghana’s economic recovery rather than misconstruing the party’s intentions regarding tax policies.

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According to the Fund, a tight policy stance, supported by robust liquidity absorption operations, is warranted to ensure that inflationary pressures—stemming from the dry spell and the recent cedi depreciation—do not de-anchor inflation expectations while inflation gradually returns within the BoG target band.

In its country assessment of Ghana after the third review of the Economic Credit Facility programme, the Bretton Woods institution said continued progress in addressing the Fund’s safeguard assessment recommendations is needed to strengthen central bank independence and operational efficiency.

Rebuilding Reserves Key Priorities Under Programme

It continued that rebuilding international reserves and accelerating reforms to enhance BoG’s foreign exchange intervention framework remain key priorities under the programme.

“The overperformance of reserves accumulation targets is welcome but mainly reflects a significant expansion of the gold for reserves programme, which warrants careful management of related portfolio risks and liquidity implications. Going forward, limiting FX [foreign exchange] interventions remains key to rebuilding external buffers”.

“The BoG made welcome progress in adopting a more robust FX reference rate computation method—which would limit the occurrence of MCPs [Multiple Currency Practices]. Implementation of a formal internal FX intervention policy framework and replacement of bilateral adjudications with a transparent auction-based FX auctions—complying with MCPs policy requirements—are additional important steps to enhance the functioning of the FX market”, it added.

Steadfast and Decisive Progress Needed in Strengthening Financial Sector

The Fund also called for steadfast and decisive progress in strengthening the financial sector.

It pointed out that the BoG has appropriately intensified monitoring and escalated measures to promote timely recapitalization and steps to sustain the viability of banks.

However, it continued that progress is needed on this front as well as on the phasing out of regulatory forbearances. Given the high NPLs, the Fund added that it will also be crucial to implement robust supervisory strategies to bolster credit and operational risk management.

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In an interview with VOA on Saturday, December 14, Mr Mahama emphasized the importance of maintaining the IMF-backed economic reforms while considering potential adjustments to better align with the country’s development needs.

Acknowledging the current economic difficulties facing Ghana, Mahama pointed out that the IMF programme, which was initiated under President Akufo-Addo’s administration, had been instrumental in stabilizing the country’s economy.

“We’ve requested further discussions with the IMF, as we were not part of the negotiations for this programme. We need to ensure that we are all aligned in terms of its implementation,” Mr Mahama explained.

“We are not going to jettison the programme. Let me make that clear. We will not abandon it, but within the framework of the programme, I believe there is room for some adjustments. If we reach an agreement on those adjustments, we will continue the programme until its conclusion,” he added.

Mahama reiterated that the economy would be the primary focus of his administration, as its state has far-reaching implications across all sectors.

“The economy will be our top priority because it impacts everything else. When the economy is in poor shape, it affects education, agriculture, sports, and every other sector of the country. Therefore, stabilizing the economy will be our foremost task,” Mahama stated.

He acknowledged that Ghana faces two major economic challenges: macroeconomic stability and debt sustainability. He noted that in previous instances of IMF engagement, the focus had been solely on macroeconomic stability, but now the country faces a dual crisis.

“Previously, when we engaged with the IMF, it was for macroeconomic stability alone, but now we have twin challenges: macroeconomic stability and debt sustainability. Therefore, we will continue with the IMF programme,” Mahama confirmed.

The $3 billion IMF deal, which Ghana entered into to support its economic recovery, includes measures aimed at reducing the country’s public debt, controlling inflation, and improving fiscal transparency.

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“Our plans to re-negotiate have also been influenced by the current state of the economy and how the John Mahama administration wants to fast-track measures to fully stabilize the economy”, he said.

Mr Terkper disclosed this on PM EXPRESS BUSINESS EDITION with host George Wiafe on December 12, 2024.

He said the re-negotiations will likely cover issues around the Primary Balance of the country, and the processes for accounting for it.

He added that the government will take a relook at the country’s debt situation and pursue “smart borrowing” to finance expensive debts and other financial commitments.

“When you look at the current debt situation and the expected payments from 2025, the incoming NDC government has to explore innovative ways to finance these debts”, he said.

He stated that the review will also look at some of the key benchmarks under the programme and the fiscal consolidation measures being implemented.

Background

President-elect John Mahama during a recent meeting with the United Nations Resident Coordinator Charles Abani revealed that his administration will press ahead to review Ghana’s Programme with the IMF and the World Bank.

According to the President-elect, the review is to ensure that the programme is aligned with the country’s current needs.

“This adjustment is crucial and will help put the new government that would be inaugurated next year on the same springboard with our development partners to begin the rebuilding of the economy and the country,” Mr Mahama stated.

Ghana is currently under a 36-month, $3 billion Extended Credit Facility with the IMF and has also signed several agreements with the World Bank, including a $250 million Ghana Financial Stability Project and another $250 million for the Ghana Energy Sector Recovery Programme.

Dealing with Investor concerns

Mr Terkper rejected the notion that the decision to go for a renegotiation could result in some negative investor reaction, a development that could hurt the economy badly.

“We have done our engagements and are still engaging these investors on their concerns that will be factored in these re-negotiations”, he assured.

Mr Terkper disclosed that the Mahama team has already engaged development partners on this issue, hence the country will not suffer as a result of the move.

“This is one of the reasons why we are holding a National Consultative Forum on the Economy and all these concerns, including re-negotiating the IMF programme will be discussed as well”.

Proposed tax cuts

President-elect Mahama has promised to remove some taxes. Key among them are the E-levy, the COVID Levy, the 10 per cent betting tax and the Emissions Levy.

Checks by JOYBUSINESS show that the COVID-19 levy brings some GH₵13.91 every year while E-Levy brings some GH₵8.27 and the Betting Tax some GH₵5.1.

Mr Terkper maintained that the team has taken measures to ensure the expected shocks are managed and do not impact badly on the economy.

“We should not forget that all the taxes are put together. It’s about 5 percent of Ghana’s Gross Domestic Product and we can find alternatives to this. We are planning to make sure that the projects will be self-financing, this other will ensure that the economy will not suffer”, he said.

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Ghana is expected to get approval for its third tranche of $360 million when the IMF Executive Board meets in June, having reached a staff-level agreement on the second review of the loan-support programme.

During an interview on Channel One TV, Dr Thompson criticised the government for overburdening its revenue sources.

Dr Nii Moi Thompson noted that the government’s failure to provide adequate credit to businesses has led to increased tariffs and a higher cost of doing business, stifling economic growth and development.

The former Director-General of the National Development Planning Commission (NDPC) warned that Ghana has overshot its wage bill by a staggering 9%, while simultaneously experiencing a revenue shortfall of approximately 4%.

He cautioned that this mismatch may lead to a precarious situation where the government may struggle to pay the salaries of public sector workers, potentially jeopardizing the livelihoods of many Ghanaians.

He noted that the wage bill is under immense strain, criticizing the government for its inability to generate sufficient revenue and invest in the economy, thereby exacerbating the pressure on the wage bill and hindering the country’s economic progress.

“Employee compensations and interest payments are some of the biggest structural impediments to fiscal rectitude in Ghana. Historically, that has been the case. On average, we exceed our wage bill by just about 9%, close to 10%. Since 2008, every single year, we have exceeded our wage bill by almost 10%.

“And over that same period, on average, we have had revenue shortfalls of around 4%. Your revenues are falling short in terms of budget, falling short by an average of 4%. But you’re exceeding your wage bill by almost 10%, and the shortfall in capital expenditure is also around 4%, so it’s like a perfect storm. You’re not investing enough in your economy, and as a result, you are not collecting enough revenue.”

He emphasized, “I see a slight decline in the wage bill for the estimated figures for last year [2022], but the others remain the same. Revenues continue to fall short, and it will actually get worse as the IMF programme is implemented.

“Because sources of revenues are business activity growth, and here you are strangulating them by not giving them credit, raising the cost of doing business, tariffs, electricity tariffs, and so forth. So we can expect this to get very difficult as we go on.”

He reiterated his stance that the IMF programme will perpetuate the economic downturn, exacerbating the existing challenges and hindering Ghana’s economic recovery.

“The IMF programme as it is now, can never solve our problems; it will only make it worse,” he said.

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According to the Director of Research at the central bank, Dr Philip Abradu-Otoo, the bank endured significant losses to help stabilise the country’s economy.

To address the economic challenges, the government initiated an IMF programme and introduced the DDEP, which resulted in some bondholders experiencing a reduction in their investments and coupons.

This programme was a critical step in securing the necessary support from the IMF.

In 2022, the BoG reported a loss of GHS 60.9 billion due to impairments that occurred during the domestic debt exchange programme. These impairments were a direct consequence of the financial restructuring efforts aimed at stabilising the economy.

In an interview with Citi TV, Dr. Abradu-Otoo highlighted the obstacles the government would have faced without the DDEP.

He emphasised that without the debt exchange programme, the government would have had to revisit other components of the DDEP, making the process even more challenging.

Dr. Abradu-Otoo attributed the significant losses suffered by the BoG in 2022 to the domestic debt exchange programme.

He insisted that the central bank took the biggest hit for the country, demonstrating its commitment to supporting the government’s economic stabilization efforts.

“The biggest one was the impairment we had on the securities that we were holding. Just like any other individual, the BoG was also holding government securities.

“Out of that GHS 60.9 billion, GHS 48 billion of that were impairment. That is the losses that we incurred on our books, as a result of the DDEP.

He emphasised, “For the debt exchange programme, nobody had a haircut on the principal…for the BoG, we had the side haircut, and top haircut and the amount itself was cut into two.

“We had three, we had to do that because we needed that to secure the IMF programme. It would have been tough to move forward very fast. Then we would have come back to the drawing board and relook at the other parts of the DDEP,” he said.

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They include zero Central Bank borrowing, a ceiling (cumulative) of GH҃4.3 billion for the primary deficit on a commitment basis; zero accumulation of external debt payments and a non-concessional borrowing limit of $66.2 million in present value terms.

In addition, the government at the end of December 2023, achieved the indicative targets including a minimum of GH¢114.19 billion for non-oil public revenue and a minimum of GH¢4.07 billion in social spending.

Speaking at the Monthly Press Briefing, Dr. Amin Adam, said the indicative target of a ceiling of zero net change in the stock of payables of the central government and payables to the Independent Power Producers (IPPs) is still being assessed and the assessment will be completed before the IMF Executive Board meeting on the 2nd Review.

He stressed that the government has also implemented structural reforms under the 2nd Review of the IMF-supported programme, including the expansion of the GIFMIS infrastructure to include over 280 IGF-reliant institutions and the publication on Public Utilities and Regulatory Commission’s website the final report of the first quarterly audit of the Electricity Company of Ghana’s single account.

“The positive results of the first and second reviews of the implementation of the IMF-supported Programme testify that we are achieving the Programme’s objective of restoring macroeconomic stability and debt sustainability, building resilience through the implementation of strong and wide-ranging structural reforms, and laying the foundations for stronger and more inclusive growth, while protecting the poor and vulnerable. We are now seeing signs of macroeconomic stability and economic recovery”, he added.

Growth turned out to be more resilient and robust in 2023 than initially programmed as Gross Domestic Product grew by 2.9% compared to the original projection of 1.5% and the revised projection of 2.3%.

Headline inflation also declined by 31 percentage points from 54.1% at the end of 2022 to 23.2% at the end of Dec 2023 before inching up slightly to 25.8% in March 2024 due largely to base effect.

He said that under the IMF programme, the Central Bank was barred from intervening in the currency exchange market when the Cedi fell against major trading currencies.

That situation prevented the Bank of Ghana (BoG) from entering the foreign currency market to stabilise the Cedi.

Prof. Bokpin commented on a local radio station that was monitored by the Ghana News Agency (GNA) over the weekend.

“Part of the reason the cedi is depreciating is also consistent with the latest IMF-supported program. Under the IMF-supported programme, they favour a stable exchange rate.

“This limits the ability of the central bank to be in the market and fight off the depreciation through our reserves.

“Part of the IMF programme is to build our reserve of three months of import cover for 2026…What that means is that it tightens the hands of the central bank to intervene in the market to sell dollars to stabilise the cedi.

“Now they cannot do that under an IMF programme,” he said.

In May 2023, the IMF Executive Board approved a US$3 billion External Credit Facility (ECF) with Ghana for 36 months.

Prof. Bokpin also identified other factors that have influenced the cedi’s recent depreciation.

He said that the cedi’s depreciation was also triggered by the delayed foreign debt restructuring, which affected the receipt of the third tranche of the ECF under the IMF programme.

The IMF has indicated that it would transfer the third tranche of $360 million, notwithstanding Ghana’s inability to negotiate a final debt agreement with its official bilateral creditors.

Mr. Charles Kusi Appiah Kubi, a representative of the Ghana Union of Traders Association (GUTA) and a panellist on the discussion, suggested the prioritisation of retention policies to stabilise the cedi since multinational companies would be barred from repatriating profits.

Dr. Kwabena Nyarko Otoo, Director of Research for the Trade Union Congress, also encouraged the Central Bank to address the “open” trade of foreign exchange in Ghana, particularly the black market, to relieve pressure on the cedi.

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The amendments to the BoG Act will feature a stricter limit for monetary financing, mechanisms to monitor and enforce compliance, and a clear definition of emergency situations under which the limit can be temporarily lifted. 

Pending legislative changes, as part of the prior actions required by the IMF before Ghana got the deal, the BoG and the Ministry of Finance signed a Memorandum of Understanding (MoU) to eliminate monetary financing during the programme.

An ongoing updated Safeguards Assessment will provide additional support for designing changes to the BoG Act. 

It will review the authorities’ gold purchase and gold-for-oil programmes and associated risks for the BoG.

The BoG’s balance sheet is also expected to be affected by the debt restructuring. 

A report on the country’s programme issued by the IMF said the government and the BoG would assess the impact and develop plans for its recapitalisation with Fund technical assistance support.

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