The International Monetary Fund (IMF) has rated the performance of the Akufo-Addo-led government high, despite mixed reactions from majority of the people.
According to the fund, government’s initial steps have been promising.
It noted that the recently assembled economic team has brought new confidence; the 2017 budget limits earmarking and seeks to control exemptions and tax evasion; and the Ministry of Finance (MoF) is pursuing improvements in public financial management (PFM) to secure spending discipline.
A team from the IMF, led by Joël Toujas-Bernaté, who visited Accra recently, as part of regular (usually annual) consultations under Article IV of the IMF’s Articles of Agreement noted: “ Investors’ response has been positive, with the exchange rate recovering in recent weeks after a rapid depreciation through end-February”.
“The latest auction of government bonds saw a record level of issuance amid high foreign investor participation”.
The fund was quick to add: “More generally, economic prospects in 2017 are encouraging . Overall GDP growth is expected at about 6 percent in 2017, reflecting a strong increase in oil production, against the backdrop of the contractionary impact of the budgeted fiscal adjustment”.
Inflation is on a declining trend and projected to fall to the upper bound of the Bank of Ghana (BoG)’s target by year-end. Following the recent sizable foreign exchange (FX) inflows, the government plans to add $700 million to its net reserves in 2017, the largest increase since 2011 when oil production started.
In 2015, Ghana signed onto a 918 million dollar extended credit facility program with the fund. The country has so far received a total of about US$464.6 million as disbursements from the IMF. The last tranche was received on 28th September, 2016.
The program aims to restore debt sustainability and macroeconomic stability in the country to foster a return to high growth and job creation, while protecting social spending.
The IMF program which was not approved by Parliament has been heavily criticized by the new government, raising concerns that it will be reviewed under their tenure. But IMF has welcomed the review.
African Eye Report
