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The Ghanaian government holds a positive outlook regarding Ghana’s swift return to the international capital market. This optimism stems from Ghana’s imminent acquisition of a US$3 billion IMF bailout to address the country’s balance of payment challenges. The initial tranche of US$600 million is projected to receive authorization by Wednesday, with disbursement expected within a week.
Upon the successful completion of the program’s first review, scheduled for November or December, the second tranche of $600 million will be allowed. Subsequently, the remaining funds will be disbursed in equal installments of $360 million, subject to semi-annual reviews.
Dr. Mohammed Amin Adam, Minister of State in the Finance Ministry, believes that this development paves the way for Ghana’s reentry into the international market. Leveraging the IMF deal to meet its financial requirements, Ghana aims to balance its financing needs. While the country receives support from development partners, a substantial portion of its inflows will come from the market. With the approval of the IMF program, Ghana expects an increase in investor confidence, which will garner favorable consideration from institutions that upgrade Ghana’s status. The government is optimistic about a potential swift return to the market.
Considering recent downgrades by international rating agencies and Ghana’s creditworthiness being reduced to junk status because of inadequate fiscal policy measures, the government has affirmed that a successful IMF program will enable Ghana to regain access to the international capital market and promote economic recovery. However, Dr. Amin Adam acknowledges that the timeline for achieving sustainable levels is crucial. If sustainable levels are attained by 2028, it may be possible for Ghana to return to the market. The minister emphasizes that borrowing cannot be ruled out entirely as long as favorable conditions exist, given that borrowing serves the purpose of benefitting the country rather than solely for its own sake.
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Source: Omanghana.com
