World Bank announced that it is supportive of the $918 million deal inked between Ghana and the International Monetary Fund
World Bank Chief Economist for sub-Sahara Africa, Francisco H. G. Fereira, said the Bank is supportive of the agreement that the IMF inked with Ghana at the beginning of the month. On April 3, 2015, the IMF approved a $918 million three-year Extended Credit Facility (ECF) for Ghana but classified the country as “high risk of debt distress” under a new debt sustainability analyses.
Fereira, who was speaking to reporters via teleconference at Washington DC, said that Ghana was struggling with an inflated payroll bill and fiscal deficits. His views seemed to underpin the IMF’s classification of Ghana as “high risk of debt distress.”
Fereira, however, said that there was a way out for countries like Ghana. According to him, distressed countries should in good times invest in savings like sovereign funds and resist the urge to spend.
World Bank supports IMF deal with Ghana but joins IMF in warning against Ghana’s fiscal condition
“In Ghana, the agreement reached with the IMF will help stabilize the cedi (which has already depreciated by 19 percent this year)), but still high inflation and fiscal consolidation will weigh on growth,” the World Bank’s analysis said, pointing to Ghana’s precarious fiscal position.