Ghana has capacity to pay back its debts –IMF

IMF: Ghana Can Repay Debts with Proper Implementation of Loan Program

Ghana can repay its debts if it follows the US$3 billion loan program with the IMF. This was stated by Mr. Stéphane Roudet, IMF Mission Chief for Ghana. He spoke during a discussion with Ghanaian journalists at the recent spring meetings in Washington, DC.

Mr. Roudet mentioned that once they go to the Board, a staff report will be published. This report will show that Ghana's macroeconomic framework assumes repayment of debts is possible. However, he noted that the government's ability to pay depends on raising necessary financing.

In the 2025 budget, the government allocated GHS13 billion for repaying arrears. This is part of efforts to meet debt obligations. Mr. Roudet responded to a question from the Ghana News Agency about government capabilities amid rising debt in 2024.

He highlighted that last year's primary balance showed a deficit of about 3.25% of GDP. In contrast, there is a target surplus of 0.5% under the current IMF program. The mission discussed short-term interventions with Ghanaian authorities to improve fiscal conditions.

Mr. Roudet praised the strong budget commitment to program objectives this year. The target is a primary surplus of 1.5% of GDP, supported by spending and revenue efforts.

The Fund has noticed some fiscal reforms already in place, including changes to the Procurement Act. These changes require Ministry of Finance authorization before public procurement agencies can issue permits.

This reform centralizes financial control in project implementation processes, according to Mr. Roudet. He also mentioned discussions on measures addressing structural challenges like Fiscal Framework and Fiscal Council reforms.

Effective implementation of these reforms could strengthen Ghana's finances and help meet debt obligations better.

Ghana has been working on a three-year US$3 billion Extended Credit Facility (ECF) program since 2023. This marks its 17th loan-supported package with the IMF aimed at restoring economic stability and sustainability.

The program began under former President Nana Addo Dankwa Akufo-Addo and continues under President John Dramani Mahama's administration until 2026.

Francis Ntow, Washington DC (USA)
GNA