The International Monetary Fund has said that Ghana’s performance under its Economic Credit Facility (ECF)-supported reform programme has been generally satisfactory.
According to the Fund, the authorities’ economic strategy is delivering on its objectives, with the economy showing clear signs of stabilization.
“Going forward, steadfast program implementation remains essential to fully and durably restore macroeconomic stability and debt sustainability, while addressing longstanding structural vulnerabilities”, it stated in a report.
It also applauded the country for making progress in strengthening its fiscal position.
Looking ahead, the Fund alluded that staying the course of fiscal policy adjustment—including before and after the upcoming elections—and creating room to enhance social programmes is paramount to put public finances on a sustainable path and reduce financing needs while cushioning the vulnerable from the impact of fiscal adjustment.
“Continued efforts to enhance domestic revenue mobilisation and streamline primary expenditure are key in this respect. These should be supported by continued progress in improving tax administration, strengthening expenditure control and management of arrears, implementing an enhanced fiscal responsibility framework, and improving SOEs [State Owned Enterprises] management”.
It added that promptly and forcefully addressing the challenges in the energy sector is also critical to containing fiscal risks, stating “Building on the recent successful Eurobond exchange, the authorities should also finalize their comprehensive debt restructuring promptly”.
It also commended the Bank of Ghana for maintaining a prudent monetary policy stance while taking decisive steps to rebuild foreign reserve buffers.
Going forward, it said maintaining an appropriately tight monetary stance, given the upside risks to inflation, and enhancing exchange rate flexibility are of the essence.
Source: Business Analyst