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Tuesday, May 30, 2023


BoG, Finance Ministry to sign MoU on $3bn IMF loan repayment

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A Memorandum of Understanding (MoU) will be signed between the Bank of Ghana and the Ministry of Finance to outline the repayment terms for the $3 billion loan from the International Monetary Fund (IMF).

The loan agreement includes favorable terms such as a 0% interest rate, a grace period of 5.5 years, and a final maturity period of 10 years.

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This loan falls under the Extended Credit Facility (ECF) arrangement, which spans over a period of three years between Ghana and the IMF.

As part of the program, Ghana aims to achieve a front-loaded fiscal adjustment equivalent to 5.1 percentage points of Gross Domestic Product (GDP) within the three-year period from 2023 to 2025. This adjustment will be achieved through the Primary Balance on a commitment basis and fiscal effort.

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Finance Minister Ken Ofori-Atta emphasized that the management of debt, both domestic and external, is crucial in restoring public debt to sustainable levels by 2028 while adhering to the two binding constraints.

They are the Public Debt (in present value terms) to GDP ratio of 55% or less; and External Debt Service to Revenue ratio of 18% or less.

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The programme will be monitored and reviewed semi-annually.

The Finance Minister emphasised that Ghana’s Post Covid-19 Programme for Economic Growth, which is the government’s blueprint for addressing the economic crisis and underpins the IMF Programme is aimed at restoring macroeconomic stability; bringing fiscal operations and public debt to sustainable levels, supporting structural reforms and promoting strong and inclusive growth while protecting the poor and vulnerable.

The Staff Level Agreement (SLA) was secured in record time in December 2022, six months after Ghana applied for a Fund-supported Programme.


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