IMF to give Ghana $94.2m to return economic stability

31 Aug 17

Ghana is to receive $94.2m from the International Monetary Fund for a programme that aims to restore debt sustainability and macroeconomic stability and foster a return to high growth and job creation.

Following a sizeable fiscal slippage in 2016, the Ghanaian government aimed at a significant fiscal consolidation this year, which would require sustained revenue collections and spending controls.

Tao Zhang, IMF deputy managing director, said: “Ghana’s macroeconomic performance over the years has been mixed.

“Policy slippages have compounded the adverse impact of shocks and resulted in significant external and domestic imbalances. The new government has committed to macroeconomic stability, fiscal discipline, and an ambitious reform agenda.

“Decisive implementation of these policies and reforms would allow Ghana to reap its economic potential and achieve higher and more inclusive growth rates.”

Zhang said Ghana had taken some encouraging steps but had to address revenue shortfalls and enforce controls to contain current spending and prevent any recurrence of its domestic arrears.

Ghana should also broaden its tax base, and enhance tax compliance and public financial management, especially as it accumulated large unpaid commitments last year, the IMF advised.

The IMF also advised it to tackle energy sector inefficiencies, and improve the management of the state-owned enterprises.

Zhang said inflation was slowing but the Bank of Ghana “should remain vigilant in order to bring inflation back to target”.

Ghana’s growth rate of 3.5% in 2016 was the lowest recorded in 20 years but recovery was expected in 2017-18 because of increased oil production and declining inflation.

Did you enjoy this article?

Related articles

Have your say

Newsletter

CIPFA latest

Most popular

Most commented

Events & webinars