Finance Minister Ken Ofori-Atta has expressed appreciation to the people of Ghana, the International Monetary Fund, CSOs and other relevant stakeholders after securing a Staff-Level Agreement (SLA) with the Fund.

The IMF in a press release on December 13 said it had reached an agreement with Ghana for US$3 billion under an Extended Credit Facility (ECF).

Ken Ofori-Atta in his remarks noted; "Since the announcement on 1st July, 2022 to formally engage the IMF for an IMF-supported Programme, there have been three rounds of negotiations with the IMF interspersed with a number of virtual meetings in-between to ensure both the GoG and the IMF teams work around the clock to get the SLA by end Dec 2022."

"Against the backdrop of Staff Programmes, Ghana is indeed blessed to conclude our SLA within 5 months. This is historic in recent times relative to what we witnessed with Zambia, Chad and Ethiopia," he added.

Read Ken Ofori-Atta's remarks below:


1. Appreciation:

i. I will like to first of all thank the almighty God for providing the needed guidance to the GoG and the Fund to get us where we are today.

ii. I will also like thank HE the President for his leadership and direction throughout this period;

iii. Let me also express appreciation to the IMF in general and in particular the IMF MD and management, Stephane Roudet, IMF Mission Chief to Ghana and Leo Medina, and the indomitable spirit of the team for their commitment to Ghana during these challenging times;

iv. In addition, I will like to express appreciation to key stakeholders including Cabinet, Parliament, FBOs, CSOs, and members of Academia, for their invaluable contributions to the preparation of the Post-Covid-19 Programme for Economic Growth (PC-PEG) which has underpinned the IMF Programme negotiations; and

v. Last but not the least I will like to express my sincere appreciation to the staff of MoF and BoG’s leadership under Governor Addison and the trusted Deputies for their hardwork and sacrifices throughout this entire process.

2. Context

i. A lot of work has gone on behind the scenes for almost 6 months when Government formally announced its intention to engage the IMF for an IMF-supported programme, to enable us reach this Staff Level Agreement (SLA) today which paves the way for the IMF’s Management and Executive Board to approve Ghana’s programme request early next year.

ii. Since the announcement on 1st July, 2022 to formally engage the IMF for an IMF-supported Programme, there have been three rounds of negotiations with the IMF interspersed with a number of virtual meetings in-between to ensure both the GoG and the IMF teams work around the clock to get the SLA by end Dec 2022.

iii. Against the backdrop of Staff Programmes, Ghana is indeed blessed to conclude our SLA within 5 months. This is historic in recent times relative to what we witnessed with Zambia, Chad and Ethiopia.

3. The IMF Programme

i. The GoG and the IMF teams have worked tirelessly to agree on key aspects of the IMF Programme at the Staff Level.

ii. Key deliverables over the period include:

a) Preparation of the Post-COVID-19 Programme for Economic Growth (PC-PEG);

b) A Medium-term macroeconomic framework;

c) Debt Sustainability Analysis (DSA) and Debt Management Strategy;

d) Structural reforms to address structural bottlenecks, improve competitiveness and promote efficiency and effectiveness;

e) A Memorandum of Economic and Financial Policies (MEFP); and

f) An Agreement on Prior Actions which are expected to be completed before the Fund goes to the Board.

iii. Ghana stands ready to complete all Prior Actions before the end-March 2023 but more importantly, Ghana is committed to the IMF Programme as a whole.

4. The SLA is only one aspect of the approval process. More is yet to be done to secure IMF Management and Board approval. That notwithstanding:

i. Key fiscal measures, structural reforms, and the medium-term macro-fiscal framework in the 2023 Budget are aligned with the IMF-supported Programme. It is therefore crucial that we receive support from all stakeholders including:

a) Parliament to ensure that the 2023 budget including all revenue measures are passed; and

b) Creditors to ensure a successful debt operation
Truly, the eventual conclusion of the program will assist us in our efforts to restore stability, tackle inflation, and strengthen our currency.

That is why the various ingredients of the program should be supported by all Ghanaians and all stakeholders.

We can only get to the IMF Board if we get sufficient commitment from our creditors in support of the debt operation.

i. The 2023 Budget is anchored on increasing domestic revenue mobilization effort by 1.2 percentage points of GDP. On the expenditure side, the 2023 Budget proposes to reduce expenditures (on commitment basis) by about 2 percentage points of GDP from 2022 to 2023. Primary expenditures are expected to be reduced through a reduction in allocation on the Use of Good and Services and Domestically Financed Captial expenditure on a commitment basis.

ii. These fiscal adjustments alone are not enough to address the country's economic challenges, hence the ongoing debt restructuring aimed at restoring debt sustainability in the medium-term.

iii. The 2023 Budget contains important social protection measures to support the most vulnerable including measures that seek to gradually increase the number of beneficiary households as well as the value cash transfers under the LEAP.

Other social protection programmes which will be prioritised under the programmes include the NHIS, the Capitation Grant, and the School Feeding Programme.
 
5. Concluding Remarks:

iv. We are optimistic that the 2023 Budget adjustment strikes the right balance between determination and pragmatism.

v. Already, the economy is responding positively to the news of GoG and the IMF reaching an SLA and we are eager to leverage this momentum to the very moment when the IMF Executive Board approves the Programme request. We are already seeing significant improvements in the exchange rate with the Ghana cedi recovering against major currencies.

vi. We hope that Ghanaians will continue to support all efforts to restore macroeconomic stability and promote robust and inclusive growth.

vii. We are confident as a resilient people, and we shall rally to support this great enterprise, to restore macroeconomic stability and promote robust and inclusive growth. The world is looking at us, and I know we can do it.

viii. To God indeed be the glory for the great thing he hath done within 5 months. I am certain that God who began the good work will continue until it is finally finished - Greater things He will do. For we shall gather the harvest with joy.

ix. These indeed are both times for a Joseph recovery and a Nehemiah rebuilding

x. Let us continue with courage, the spirit of love for each other and self-discipline to go through this together.

xi. Thank you and God Bless.