Ghana’s incoming president, John Mahama, plans to renegotiate the country’s $3 billion financing program with the International Monetary Fund (IMF), but the lender has signaled its willingness to cooperate provided that key reforms remain intact, Bloomberg reports.
Mahama, who reclaimed the presidency after winning last weekend’s election, has stated his intention to adjust the IMF package to ease repayment terms on restructured loans and reduce corporate tax burdens. He intends to prioritize stability over rapid economic growth in his upcoming term.
The IMF confirmed its openness to discussions.
“IMF-supported programs are developed collaboratively with each country’s authorities,” a spokesperson said. “Any changes must ensure that the economic objectives of the reform programs remain achievable.”
The current program, which commenced in May 2023, aims to restore macroeconomic stability, ensure debt sustainability, and foster inclusive growth. Key targets include achieving a primary budget surplus of 0.5% of GDP by year-end and reducing the debt-to-GDP ratio to 55% by 2028.
Ghana’s economic struggles have been profound. Inflation soared to 54.1% two years ago before easing to 23% in November. The cedi has depreciated roughly 60% over the past four years, leading the central bank to raise interest rates to a two-decade high of 30% before a recent reduction to 27%.
Financial analysts, such as Barclays Plc, anticipate that the renegotiation will primarily focus on aligning the new administration’s economic priorities with the existing IMF framework rather than a complete abandonment of the program.
Mahama’s landslide victory, securing 56.6% of the vote, reflects widespread public discontent over the high cost of living and the government’s handling of the debt crisis under outgoing President Nana Akufo-Addo. His inauguration is scheduled for January 7.
