Staff-level agreement alone not sufficient to release third tranche to Ghana, IMF says

Ghana has achieved a Staff-Level Agreement with the International Monetary Fund (IMF) for the second review of its Extended Credit Facility.

However, the IMF Executive Board insists that Ghana must secure financial assurances from external creditors before the planned $360 million can be disbursed.

During April 2-12, 2024, an IMF staff delegation, led by Mission Chief Stéphane Roudet, assessed Ghana’s reform progress and policy focus within the Extended Credit Facility’s framework.

This evaluation marks a significant step in Ghana’s efforts to secure a $360 million package, pending the necessary financial assurances from external creditors.

The IMF emphasizes that the staff-level agreement is contingent upon IMF Management approval and Executive Board consideration after obtaining the required financing assurances.

A crucial aspect of this process involves Ghanaian authorities reaching an agreement with official creditors on a Memorandum of Understanding (MoU) for debt treatment consistent with program parameters.

The Ministry of Finance had previously anticipated finalizing the terms of a debt relief plan with official bilateral creditors through individual bilateral agreements within an MoU.

These negotiations are essential to ensure prompt implementation of the agreed terms, although challenges such as comparability of treatment may arise, potentially affecting the timeline for IMF Executive Board approval.

Until Ghana formalizes the necessary financing assurances in an MoU, the disbursement of the $360 million remains pending.

However, Ghana remains optimistic about fruitful discussions with external creditors, particularly in the bilateral sector, to secure the required financial assurances and facilitate the implementation of the agreed terms.

Source-myjoyonline