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IMF mission says Ghana economy rebounding

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IMF mission says Ghana economy rebounding

A country mission of the International Monetary Fund said on Friday that Ghana has managed its COVID-19 outbreak very effectively and its economy is rebounding with the support of strong policies.

“Policy interventions in 2020 were also critical to safeguard livelihoods and paved the way for a faster rebound of economic activity,” said Carlo Sdralevich, the mission head, in a statement following virtual meetings ended on May 12.

He said last year’s government actions to contain the pandemic also exacerbated pre-existing budget constraints and public debt vulnerabilities.

“The 2021 budget’s recent policy pivot towards fiscal consolidation is an important step in the right direction and a difficult one in a pandemic,” said Sdralevich.

Fiscal consolidation should focus around debt and debt service reduction while allowing for social, health, and development spending, he added.

The West African country owes the Fund about $2 billion, including $1 billion in pandemic aid funding received in April 2020.

Ghana spends roughly half of its revenue on interest payments, with total debt rising near 80% of GDP.

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