Economy

IMF’s $1 billion cash to hit BoG’s account Thursday

The Country Representative of the International Monetary Fund (IMF) has said the $1 billion IMF rapid credit facility world hit the Bank of Ghana’s account on Thursday. 

According to Dr Albert Touna Mama, the required documentation has been finalized for the necessary disbursement to be made to the Bank of Ghana on Thursday, April 16, 2020, adding that “ I had a confirmation on Wednesday morning that the transfer order has been activated therefore it should be in the Bank of Ghana’s account on Thursday, April 16, 2020”  

Dr Touna Mama also added that the transfers would be a one-off and would not be done in tranches. 

The facility has also been structured in a way that it would not bring any pressure on the government when it comes to the payment of its debts.  

Background

The Executive Board of the IMF on Monday approved some $1 billion Rapid Credit Facility for Ghana. 

This was after a formal request was made by the government of Ghana on March 16 2020. 

The disbursement will help address the urgent fiscal and balance of payments needs that Ghana is facing, improve confidence, and catalyse support from other development partners. 

According to the IMF, the Rapid Credit Facility under the emergency financial assistance will help address the country’s urgent financing needs, improve confidence, and catalyze support from other international partners.

Checking the use of the $1 billion

According to the IMF country representative, they believe that even though the funds would not come with any conditionalities, they trust that the country has the required fiscal laws and required civil social interest to check prudent use of these funds. 

There were fears that these funds might not be spent prudently, but mama argues that with all these structures in place, may there be no need for us to be worried. 

Again it is expected the Audit service is going to play a critical role in terms of any money that hits the government’s account.

Is Ghana going to go into an economic recession?

Mr Mama noted that based on their forecasts Ghana would indeed end the year with about 1.5 per cent economic growth. 

He was responding to a question whether Ghana would indeed end the year going into recession as forecasted by some of the country’s development partners. 

He added that other factors might work in favour of the government of Ghana, like gold prices picking up strongly. He, however, maintained that this would be based on the duration of this COVID 19.