The International Monetary Fund has reached staff-level agreement with Ghana on the fifth review of the country’s three-year economic reform program, potentially unlocking USD 385 million in additional financing pending executive board approval expected by December.
The agreement, announced Thursday following meetings in Accra from September 29 to October 10, brings total IMF disbursements under the Extended Credit Facility (ECF) arrangement to approximately USD 2.825 billion since the program began in May 2023. The original three-year facility totals USD 3 billion.
Ruben Atoyan, who led the IMF staff team, said Ghana’s macroeconomic stability had strengthened significantly, with first-half 2025 growth exceeding expectations due to robust services activity and agricultural output. He projected 4.8 percent growth for 2026 with inflation remaining within the Bank of Ghana’s target band of 8±2 percent.
“The positive momentum is expected to continue into 2026,” Atoyan stated, noting that improved export performance, particularly in gold and cocoa, enabled continuous improvement in international reserve accumulation that exceeded program targets.
The USD 385 million represents SDR 267.5 million, using the IMF’s Special Drawing Rights currency basket. The disbursement requires approval from IMF management and the executive board, processes that typically take several weeks following staff-level agreements.
Ghana’s external sector has strengthened considerably, with a solid current account surplus supporting reserve accumulation. However, Atoyan cautioned that “external risks remain significant largely on account of lingering uncertainty of commodity prices for Ghana’s key exports.”
The IMF team welcomed progress in Ghana’s comprehensive debt restructuring efforts. The country recently signed a Memorandum of Understanding with the Official Creditor Committee under the Group of 20 Common Framework and concluded bilateral agreements with five countries.
This debt restructuring represents a critical component of Ghana’s economic recovery strategy. The country defaulted on most external debt in December 2022 as foreign reserves depleted and the cedi collapsed, forcing the government to seek IMF support.
Finance Minister Cassiel Ato Forson expressed satisfaction with the review outcome, stating that macroeconomic stabilization is taking root. The government has implemented fiscal consolidation measures, including revenue mobilization efforts and expenditure controls, as conditions for continued IMF support.
However, significant challenges persist. Ghana’s public debt remains elevated at over 70 percent of GDP despite restructuring efforts. High domestic interest rates, while declining from crisis peaks, continue constraining private sector credit and economic activity.
The country’s banking sector has shown resilience, maintaining adequate capitalization despite economic turbulence. However, non-performing loans increased during the economic crisis, and full recovery in asset quality will require sustained economic improvement.
Inflation has declined substantially from peaks above 50 percent in 2023 to current levels around 20 percent, approaching but not yet reaching the Bank of Ghana’s target range. Further disinflation depends on continued fiscal discipline and stable exchange rates.
The cedi has stabilized relative to the dollar after losing over 50 percent of its value during 2022 and early 2023. Reserve accumulation supported by strong commodity exports has enabled the central bank to intervene more effectively in foreign exchange markets.
Gold and cocoa exports have performed strongly, with gold prices remaining elevated and cocoa production recovering from disease-related declines. However, commodity price volatility represents a significant risk to Ghana’s external position and fiscal revenues.
The IMF program includes structural benchmarks beyond macroeconomic targets, including public financial management reforms, revenue administration improvements, and state-owned enterprise restructuring. Progress on these structural reforms has been mixed, with some areas advancing faster than others.
Political considerations loom as Ghana approaches future elections. IMF programs often face implementation challenges during election periods as governments face pressure to increase spending and delay unpopular reforms. Maintaining program discipline through political cycles represents a perennial challenge.
For ordinary Ghanaians, the IMF program’s success will be measured by improved living standards rather than macroeconomic indicators. While inflation has declined and growth resumed, many citizens continue struggling with high living costs and limited employment opportunities.
The fifth review’s approval suggests Ghana has met most quantitative performance criteria and structural benchmarks for the period. However, sustained compliance through the program’s remaining period will determine whether macroeconomic stability translates into lasting economic transformation.
Whether the USD 385 million disbursement and broader program ultimately achieve their objectives depends on factors beyond IMF financing, including global commodity prices, domestic policy discipline, and the government’s ability to implement difficult structural reforms while maintaining political support.
