Ghana has reached a $3 billion bailout deal with the International Monetary Fund as it faces a severe economic crisis, the IMF said on Tuesday.
Ghana is already heavily indebted, facing historic inflation of over 40% and a collapsing currency (cedi) that has worsened since Russia’s invasion of Ukraine.
“To be able to announce that the IMF team has reached an agreement with the Ghanaian authorities on a three-year program (…) under the Extended Credit Facility (ECF) amounting to (…) approximately $3 billion. I’m delighted to see the dollar,” said Stefan Ruden, head of the IMF’s mission to Ghana. and the deal must now be approved by the IMF Executive Board in Washington.
Ghana’s President Nana Akufo Addo has come under fire for asking the IMF for help after pledging to deal with the economic crisis, particularly “aid-free Ghana.”
Many Ghanaians fear the deal will force the government to adopt austerity measures that will further strain a population already facing rising prices.
Ghana is a major cocoa and gold producer and has oil and gas reserves, but debt service has skyrocketed. And like the rest of sub-Saharan Africa, it has been hit hard by the global pandemic and the aftermath of the war in Ukraine.