Ghana will receive US$1.32 billion from the IMF and World Bank, covering 35% of its 2025 budget deficit. US$720 million will be from the IMF Extended Credit Facility, and US$600 million from the World Bank. The government plans to finance the remaining deficit through domestic borrowing.
Ghana is set to receive a substantial financial assistance package totaling US$1.32 billion from the International Monetary Fund (IMF) and the World Bank. This funding will cover 35 percent of the country’s budget deficit for the fiscal year 2025. Dr. Cassiel Ato Forson, Minister of Finance, detailed that US$720 million will be allocated through the ongoing IMF Extended Credit Facility (ECF) program, while the World Bank’s Development Policy Operation (DPO) will contribute US$600 million.
The total cash deficit is projected to reach GH¢56.9 billion, funded by both foreign and domestic resources. The minister indicated that foreign net financing is expected to amount to GH¢21.4 billion, representing 1.5% of Ghana’s GDP. This includes the aforementioned IMF and World Bank contributions.
To address the remaining 65 percent of the budget deficit, which amounts to GH¢36.9 billion or 2.6% of GDP, the government plans to utilize domestic borrowing primarily through the issuance of short-term treasury bills.
The IMF-ECF program aims to restore Ghana’s macroeconomic stability and enhance debt sustainability in light of recent fiscal difficulties. Concurrently, the World Bank’s DPO is designed to support necessary policy reforms and facilitate economic recovery efforts. Minister Forson emphasized the government’s dedication to fiscal discipline and responsible debt management, ensuring the efficient use of these funds.
Ghana’s acquisition of US$1.32 billion from the IMF and World Bank represents a critical element in addressing its budgetary constraints for 2025. The combined foreign financing through these institutions will account for a significant portion of the budget deficit. Efforts to manage domestic borrowing and ensure fiscal stability will be crucial as the government endeavors to implement effective economic recovery strategies.
Original Source: www.ghanaweb.com
