Ghana is poised to receive a substantial financial boost aimed at stabilizing the cedi, according to Dr. Abudu Abdulganiyu, technical adviser at the Ministry of Finance.

In an interview on Morning Starr with Francis Abban Dr. Abdulganiyu discussed the anticipated release of $360 million from the International Monetary Fund (IMF) by the end of June.

“Yes, so that we are confident that by the end of June, we should secure the release. We already have a staff level agreement with the IMF. And again, the IMF, all they were waiting for was this MOU to be signed with the OCC,” Dr. Abdulganiyu said.

He explained that the IMF staff will present the agreement to the executive board, expecting approval for the release of funds under the extended credit facility program.

This financial inflow, amounting to $360 million, is considered a significant step towards stabilizing the cedi. Dr. Abdulganiyu noted the ongoing efforts of the Bank of Ghana, which injects about $20 million into the market weekly to meet the fluctuating demand for foreign exchange.

“Everything depends on the level of demand,” he stated, acknowledging the difficulty in making precise forex demand projections. However, he assured that the central government will continue its efforts to release forex to stabilize the cedi.

Dr. Abdulganiyu also highlighted other expected financial inflows that will contribute to stabilizing the currency. These include a debt service moratorium with bilateral creditors, which provides relief from principal and interest payments between 2023 and 2026, resuming in 2027. This moratorium allows the government to allocate resources to productive areas, strengthening the economy by the time debt servicing resumes.

Additional inflows expected before the end of the year include $300 million from the World Bank as part of the development policy operation, funds from the cocoa syndicated loan, and the Garrett project, also supported by the World Bank, which is expected to bring in $150 million. Overall, the government anticipates an injection of about $2 billion into the economy by the end of 2024.

“The expectation is that before the end of the year we should get an injection of about 2 billion U.S. dollars into the economy. So short term, that stabilizes the cedi,” Dr. Abdulganiyu explained, expressing optimism that these measures will help the cedi regain some of its lost value.

According to him, this comprehensive strateg, combining IMF support and other financial inflows, aims to halt the depreciation of the cedi and stabilize Ghana’s economy.

Source: Ghana/ Mensah