In the latest development on the government's engagement with the International Monetary Fund (IMF), President Akufo-Addo has disclosed that the government will submit a program for the $3 billion facility being secured from the IMF by the end of March.

He made this known during the 2023 State of the Nation’s address held in Parliament on March 8, 2023.

During the address the president indicated that the government is making progress with the deal.

“Mr. Speaker, we are also making progress on the external debt negotiations since the Government announced an external debt service suspension on 19th December 2022 for certain categories of external debt, to ensure an orderly restructuring. This suspension is an interim emergency measure toward a comprehensive external debt operation which will contribute to the restoration of our debt sustainability in line with our request for a debt treatment under the G20 Common Framework.

“I want to express our appreciation to the members of the Paris Club and to the Peoples’ Republic of China for the co-operation they have so far exhibited to us in attempting to reach an agreement, and in their attempt to establish an Official Credit Committee. We look forward to their fast-tracking the needed financing assurances for IMF approval. We are confident that, with their co-operation, we will reach our March deadline for going to the Fund,” he said.

Government is still in talks with the IMF to secure a financial bailout for the country. According to the government, discussions with the Bretton Wood institution are far advanced, however, a few outstanding measures have hampered the government from securing the bailout.

“Mr. Speaker, having reached the Staff Level Agreement on 12th December, 2022, after five (5) months of intense negotiations, and completion of most of the prior actions required under the Agreement, we are on course for the IMF Staff to present to the IMF Executive Board Ghana’s Programme request for a three billion dollar (US$3 billion) Extended Credit Facility by the end of the month,” he said.

“I thank the House for its support throughout this process, including the passage of key revenue laws. However, a few more of these measures, namely Income Tax (Amendment) Bill, Excise Duty & Excise Tax Stamp (Amendment) Bills, as well as the Growth and Sustainability Levy Bill, are outstanding, which need the urgent attention of the House and passage to complete the prior actions. This will put us in readiness for our presentation to the Fund Board, and, more importantly, bolster our domestic revenue mobilisation effort,” he said.

Addressing the House, the President acknowledged that given the extent of the fiscal and debt sustainability issue currently being addressed, it is clear that fiscal adjustment and structural reforms are not sufficient for restoration of debt sustainability.

"A critical component of the measures we are implementing to address the current economic crisis is the debt operation, involving both domestic debt and external debt. The debt operation is aimed at returning the country to debt sustainable path by 2028, by reducing the debt-to-GDP ratio on a general classification basis and, in present value terms, from one hundred and three percent (103%) in 2022 to fifty-five percent (55%) by 2028; and reducing the external debt service-to-revenue ratio from twenty-nine percent (29%) in 2022 to eighteen percent (18%) by 2028.

In order to achieve these goals, the President said a decision was taken to execute a Domestic Debt Exchange Programme (DDEP), in addition to fiscal adjustment, external debt operation and structural reforms.

Touting the progress government has made with the DDEP, he thanked organised labour, pensioners, pension fund managers, the Ghana Association of Banks (GAB), Ghana Securities Industry Association (GSIA), Ghana Insurers Association (GIA), the Individual Bond Holders and Retirees Forum, and all others who have contributed to make the programme a success.

"The participation rate of eighty-five percent (85%), representing tendered bonds of eighty-three billion cedis (GH¢83 billion) out of the total eligible bonds of ninety-seven point seven billion cedis (GH¢97,749,624,691), constitutes significant success for the DDE Programme. The eighty-three billion cedis (GH¢83 billion) bonds that were successfully tendered, also, represents sixty-four percent (64%) of the outstanding domestic debt stock of one hundred and thirty billion cedis (GH¢130 billion) at the end of December 2022, as pension funds have been expressly exempted from the DDEP," he said.

Source: The Independent Ghana