PRETORIA – The International Monetary Fund (IMF) has approved $1 billion (about R18.3 billion) to assist Ghana in its struggle against the coronavirus outbreak.
"The Covid-19 pandemic is already impacting Ghana severely. Growth is slowing down, financial conditions have tightened and the exchange rate is under pressure. This has resulted in large government and external financing needs," the IMF said in a statement.
The IMF said it continues to monitor Ghana’s situation closely and stands ready to provide policy advice and further support as needed.
“The authorities’ response has been timely, targeted and proactive, focused on increasing health and social spending to support affected households and firms. The central bank has recently taken steps to ensure adequate liquidity, preserve financial stability and mitigate the economic impact of the pandemic while allowing for exchange rate flexibility to preserve external buffers.
“The uncertain dynamics of the pandemic create significant risks to the macroeconomic outlook. Ghana continues to be classified at high risk of debt distress. The authorities remain committed to policies consistent with strong growth, rapid poverty reduction and macroeconomic stability over the medium term.
“Additional support from other development partners will be required and critical to close the remaining external financing gap and ease budget constraints," IMF deputy managing director and chairperson Tao Zhang said in a statement.
Last week, the IMF said it had also approved $147.4 million to help Senegal meet the urgent balance-of-payment needs stemming from the Covid-19 pandemic.
“The Covid-19 pandemic is having a severe impact on Senegal, creating an urgent balance-of-payments and fiscal financing need. To mitigate the impact of the pandemic, the authorities have acted fast by increasing health spending and providing targeted support to vulnerable households and firms, including through food aid, suspension of utility bill payments for the poorest, and targeted tax relief.
“The IMF’s emergency financing under the Rapid Credit Facility and the Rapid Financing Instrument will provide much-needed liquidity to support the authorities’ response to the crisis and could catalyse further assistance from the international community, preferably in the form of grants," said IMF deputy managing director and acting chairperson Mitsuhiro Furusawa in a statement.