IMF Approval, Sign Of Renewed Investor Confidence
– In Ghanaian Economy, Finance Minister declares
Story: Isaac AIDOO, Accra
THE Ghanaian government has touted its economic achievements over the past eight years, describing the recent successful review by the International Monetary Fund (IMF) as evidence of renewed investor confidence in the Ghanaian economy.
The IMF, in its third review under the bailout programme, stated that “Ghana’s policy and reform efforts under the IMF-supported programme have continued to deliver encouraging results.”
Minister of Finance Highlights Economic Resilience
Speaking at the Monthly Economic Update in Accra, Finance Minister Dr. Mohammed Amin Adam, stated that the IMF’s endorsement demonstrates international confidence in Ghana’s economic recovery and reform agenda.
“The testament by the IMF underscores our firm commitment to the policies, structural reforms, and programme objectives under the Programme,” Dr. Amin Adam said.
He attributed the positive review to the collective resilience of Ghanaians, which he believes is driving the nation’s recovery.
Macroeconomic Stability and Reforms
The Finance Minister outlined several achievements under the programme:
- Macroeconomic Stability: Inflation and exchange rates have stabilized, contributing to a more predictable economic environment.
- Structural Reforms: Improvements in public financial management, revenue optimization, expenditure control, and exchange rate management have been firmly instituted.
- Social Protection: Enhanced measures are being implemented to safeguard vulnerable populations.
Meeting IMF Targets
Dr. Amin Adam celebrated Ghana’s ability to meet all six end-June 2024 Quantitative Performance Criteria and four indicative targets for the first time in its history under an IMF programme.
“This unprecedented achievement is a testament to our unwavering commitment to economic recovery and discipline,” he noted.
Economic Growth Rebounds Strongly
Ghana has recorded strong economic growth, with real GDP increasing by:
- 6.9% in Q2 2024, following 4.7% in Q1 2024 and 3.8% in Q4 2023.
This marks an average growth of 5.8% in the first half of 2024, the highest in five years, signaling a return to pre-pandemic growth levels.
Though Q3 2024 GDP data from the Ghana Statistical Service is pending, the Bank of Ghana reports robust growth, with the Composite Index of Economic Activity (CIEA) rising by 2.8%, a sharp rebound from a contraction of 2.4% in Q3 2023.
External Sector and Reserve Improvements
The country’s external sector performance also improved significantly:
- Gross International Reserves (GIR): Climbed to $7.7 billion in October 2024, equivalent to 3.5 months of import cover, up from $5.2 billion (2.4 months) in October 2023.
- Current and Trade Accounts: Registered stronger-than-expected performance, bolstering Ghana’s external position.
Key Achievements in 2024
The Finance Minister detailed other notable accomplishments, including:
- The highest growth rate in five years, averaging 5.8% in the first half of 2024.
- Downward trends in inflation.
- A strengthening cedi.
- Fiscal discipline in an election year, even amid large-scale infrastructure development.
- Successful completion of both domestic and external debt restructuring.
- A record-time negotiation and execution of a $3 billion, 3-year IMF-supported programme, with three reviews completed successfully.
According to the minister, government sees the IMF’s positive review as validation of its efforts to restore economic stability and growth. With strong growth indicators, stable macroeconomic conditions, and ongoing reforms, Ghana is on track to build a resilient and investor-friendly economy.
