Ghana Set to Get $600m Loan Approval From IMF on Friday

The Executive Board of the International Monetary Fund (IMF) will meet on Friday to approve a rescue loan of $600 million to west African country of Ghana, according to sources at the IMF.

Ghana struck the deal with its bilateral lenders, including China and France, late last week, a key step to unlocking the second tranche of IMF funding under a $3 billion bailout.

IMF Managing Director Kristalina Georgieva welcomed the debt deal agreement on Friday, saying it clears the path for the executive board’s first review of Ghana’s programme.

A sign off by the board is usually seen as a formality once a date has been agreed.

The West African country defaulted on most external debt in December 2022 after servicing costs soared.

It also needs to reach a relief deal with private holders of about $13 billion in international bonds.

It is aiming to restructure $20 billion of external debt, which totalled about $30 billion at the end of 2022, under the Common Framework, a debt restructuring process set up by the G20 countries during the COVID-19 pandemic. It has targeted cutting $10.5 billion from payments due between 2023-2026.  Naira Rises by 19% as Forex Market Pressures Ease

The IMF second tranche payout, once signed off, should also trigger $550 million in additional World Bank funding, Ghana’s finance ministry said.