An IMF team will meet with Ghanaian officials from February 8, 2025, to discuss the economy and the upcoming 2025 Budget. Key issues include debt management, energy sector privatization, and tax policy adjustments which could significantly impact revenue. This preliminary visit is geared towards aligning fiscal strategies with IMF program objectives, ahead of a formal review later in the year.
An International Monetary Fund (IMF) delegation is visiting Accra, Ghana, from February 8, 2025, focusing on the country’s economy and preparations for the 2025 Budget. This week-long engagement will assess progress on negotiations with external creditors and strategies to manage energy sector debts, including potential privatization of the Electricity Company of Ghana’s operations.
The IMF visit is an initial engagement regarding the economy and budget, distinct from a formal review mission. The fourth review of Ghana’s IMF program, scheduled for later in the year, will evaluate fiscal performance up to December 2024, with the possibility of a cash tranche by June 2025.
Key discussions will revolve around ensuring the 2025 Budget adheres to IMF objectives aimed at revenue mobilization and sustainable debt management. There are concerns about potential revenue gaps if the Finance Minister proceeds with the removal of certain taxes, estimated to cost GH¢10 billion annually. Additionally, the IMF will assess the government’s broader economic reset plans.
Finance Minister Dr. Ato Forson indicated intentions to negotiate an extension of the IMF program to secure more funds for economic stabilization, providing an opportunity for enhanced dialogue during the visit. Since entering the IMF program in May 2023, Ghana has received approximately $1.9 billion in financial assistance, which has aided in debt restructuring.
The IMF recognized significant improvements in Ghana’s economic performance, noting that growth in early 2024 surpassed expectations and inflation has been declining. This upcoming engagement highlights the collaborative effort between Ghana and the IMF to stabilize the economy and foster sustainable growth.
The IMF visit is set against a backdrop of Ghana’s efforts to restructure its economy following challenges related to debt sustainability and inflation control. Since May 2023, Ghana has been involved in an IMF program aimed at financial stabilization. Discussions will focus on the 2025 Budget, revenue strategies, and the potential impacts of tax reductions, which are critical for the country’s economic trajectory.
The expected talks between the IMF and Ghanaian officials are crucial for the nation’s economic management as it prepares for the 2025 Budget. The outcomes of these discussions will likely influence Ghana’s future fiscal policies, aiming for revenue stability while managing debt effectively. The engagement reflects continued support from the IMF in Ghana’s journey towards sustained economic growth.
Original Source: citinewsroom.com
