IMF team arrives in Ghana to discuss economic policies and 2025 budget

An International Monetary Fund (IMF) delegation is set to arrive in Accra on February 8, 2025, for discussions with government officials on Ghana’s economic outlook and preparations for the 2025 Budget.

The visit, which will last a week, is expected to focus on key fiscal policies, including the government’s negotiations with external creditors and plans to manage the country’s energy sector debts. The delegation will also assess potential privatization measures within the Electricity Company of Ghana (ECG).

Budget Alignment, Revenue Concerns

Although not part of a formal review, the visit will provide an opportunity for preliminary engagements on the economy and the upcoming budget, which is scheduled to be presented in Parliament in March.

A crucial aspect of the discussions will be ensuring that the 2025 Budget aligns with the IMF programme’s objectives, particularly revenue mobilization and debt sustainability. The IMF is expected to seek clarity on how the government intends to address potential revenue gaps if certain taxes, including the COVID-19 Levy, E-Levy, and Betting Tax, are removed. Experts estimate that scrapping these taxes could result in a revenue shortfall of GH¢10 billion annually.

Potential IMF Programme Extension

Finance Minister Dr. Ato Forson recently hinted at plans to negotiate an extension of Ghana’s IMF programme to secure additional funds for economic stabilization. The upcoming discussions will allow both parties to explore this proposal, though the IMF has emphasized that any extension must align with the broader programme objectives.

Since Ghana entered the IMF programme in May 2023, the country has received approximately $1.9 billion in financial support. Following Ghana’s successful third review, the IMF praised the nation’s progress in debt restructuring and economic recovery.

“Economic growth in the first half of 2024 exceeded expectations, inflation has continued to decline, and the fiscal and external positions have shown marked improvements,” the IMF noted in a statement.

The IMF’s fourth review of Ghana’s programme, based on fiscal data up to December 2024, is expected later this year. A positive assessment could lead to another financial disbursement by June 2025.

This latest engagement underscores the continued collaboration between Ghana and the IMF as they work toward stabilizing the economy and ensuring sustainable growth.