IMF Approves $918m to Boost Ghana’s Economy
by SYLVA EMEKA-OKEREKE
Nigerian National Mirror
Apr 8, 2015
The International Monetary Funds, IMF, has approved a three-year arrangement under the Extended Credit Facility, ECF, to support the medium-term economic reform programmes in Ghana.
The programme, which aims to restore debt sustainability and macroeconomic stability in the country, would also foster a return to high growth and job creations while protecting social spending.
Deputy Managing Director and Acting Chairman of the Executive Board of the IMF, Mr. Min Zhu said, after two decades of strong and broadly-inclusive growth, the large fiscal and external imbalances in recent years, have led to a growth slowdown, putting Ghana’s medium-term prospects at risk.
Public debt, Zhu said, has risen at an unsustainable pace and external position while weakening considerably.
According to IMF, government has embarked on a fiscal consolidation path since 2013, but policy slippages, exogenous shocks, and rising interest costs have undermined the efforts, noting that acute electricity shortages are also constraining economic activities.
“The new ECF-supported programme, anchored on Ghana’s Shared Growth and Development Agenda, aims at strengthening reforms to restore macroeconomic stability and sustain higher growth. The main objectives of the programme are to achieve a sizeable and frontloaded fiscal adjustment while protecting priority spending and strengthening monetary policy by eliminating fiscal dominance and safeguard financial sector stability’’, it stated.
Continuing, it said, “Achieving key fiscal objectives will require strict containment of expenditure, in particular of the wage bill and subsidies. The government’s efforts to mobilize additional revenues will also help create more space for social spending and infrastructure investment, in particular in the energy sector. The government is rightly adjusting expenditures further to mitigate the shortfall in oil revenue and avoid a larger debt build-up. Moreover, a prudent borrowing strategy will be needed to ensure that financing needs are met at the lowest possible cost’’.
The government’s structural reform agenda, according to IMF, would focus on strengthening public financial management and enhancing transparency in budget preparation and execution while strengthening expenditure control which is critical to avoid new accumulation of domestic arrears.
Nigerian National Mirror
Apr 8, 2015
The International Monetary Funds, IMF, has approved a three-year arrangement under the Extended Credit Facility, ECF, to support the medium-term economic reform programmes in Ghana.
The programme, which aims to restore debt sustainability and macroeconomic stability in the country, would also foster a return to high growth and job creations while protecting social spending.
Deputy Managing Director and Acting Chairman of the Executive Board of the IMF, Mr. Min Zhu said, after two decades of strong and broadly-inclusive growth, the large fiscal and external imbalances in recent years, have led to a growth slowdown, putting Ghana’s medium-term prospects at risk.
Public debt, Zhu said, has risen at an unsustainable pace and external position while weakening considerably.
According to IMF, government has embarked on a fiscal consolidation path since 2013, but policy slippages, exogenous shocks, and rising interest costs have undermined the efforts, noting that acute electricity shortages are also constraining economic activities.
“The new ECF-supported programme, anchored on Ghana’s Shared Growth and Development Agenda, aims at strengthening reforms to restore macroeconomic stability and sustain higher growth. The main objectives of the programme are to achieve a sizeable and frontloaded fiscal adjustment while protecting priority spending and strengthening monetary policy by eliminating fiscal dominance and safeguard financial sector stability’’, it stated.
Continuing, it said, “Achieving key fiscal objectives will require strict containment of expenditure, in particular of the wage bill and subsidies. The government’s efforts to mobilize additional revenues will also help create more space for social spending and infrastructure investment, in particular in the energy sector. The government is rightly adjusting expenditures further to mitigate the shortfall in oil revenue and avoid a larger debt build-up. Moreover, a prudent borrowing strategy will be needed to ensure that financing needs are met at the lowest possible cost’’.
The government’s structural reform agenda, according to IMF, would focus on strengthening public financial management and enhancing transparency in budget preparation and execution while strengthening expenditure control which is critical to avoid new accumulation of domestic arrears.
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