The International Monetary Fund (IMF) has rescheduled the board meeting to consider Ghana’s second review under the Fund programme and the disbursement of $600 million to January 11, 2024.

This is what Joy Business has picked up from some members of the Official Creditor Committee (OCC) negotiating with Ghana on restructuring of the country’s debt with bilateral creditors..

The sources have described some significant progress that Ghana has made with its external bilateral creditors on the terms of restructuring the bilateral debt, especially with China.

Joy Business also understands that just last week a significant headway was made with China, which is one of the Co-Chairs of the OCC, on the proposed terms for restructuring the country’s bilateral debt.

It is based on these developments that the IMF has put up this new date. It is believed that all lingering issues would have been addressed before this new date to enable the board meet on Ghana’s programme.

Sources say a draft Memorandum of Understanding would have been issued by the Official Creditor Committee by now, but a concern from one of the members delayed this action.

Why the delay?

The IMF Board was expected to meet on Ghana’s programme for the second review in November 2023.

However, the challenge in reaching an agreement with China on the debt restructuring compelled the Fund to reschedule the date on two occasions; in the first week of December 2023 and December 21, 2023.

This is though these dates were not officially captured on its website.

The situation was similar to what happened during Ghana’s programme approval by the IMF earlier this year.

China had earlier raised concerns about the “Test Date” for restructuring Ghana’s debts. The Asian giant, according to our sources, wanted the IMF to review the December 2022 dates.

Some developments in China also affected Ghana, in terms of quick progress on the preliminary deal reached with the Official Creditor Committee.

However, sources say, all these hurdles have now been cleared and that could soon help the Official Creditor Committee to issue the needed MoU on Ghana’s debt restructuring.

Will the January 11, 2024 date be rescheduled again?

Based on engagements with some persons on the Official Creditor Committee, there are optimism that some significant progress will be made before the Board meeting on January 11, 2024. This is due to some fresh commitment from China.

Sources say, China has resolved to address all the issues with Ghana before the new board meeting date.

What is the IMF Board looking for, before it meets on Ghana

Sources say the IMF is not considering a “Full Agreement” between the Official Creditor Committee and Ghana on restructuring of the bilateral debt, but want what some may describe as a “Letter of Comfort” or Memorandum of Understanding from the Official Creditor Committee that it is open to discussions with Ghana on restructuring the bilateral debt.

Some have argued that the IMF is also looking for some assurance from these bilateral creditors that they will fully participate in providing the financing assurance for Ghana’s programme.

Joy Business also understands that there could be a high powered visit to China by the Ghanaian authorities to try and address all the lingering issues with China. 

All these are expected to happen before the January 1, 2024.

Again, some sources say China is also working to get the required “Political Blessing” for all the initial agreements to be reached at the level of the Official Creditor Committee to fast-track the discussions.

Government’s response to these developments

Officials of the Government of Ghana have expressed confidence in securing a deal, because of the significant progress that has been made with all the bilateral creditors on restructuring of their debt.

They argue that Ghana will be able to get the Official Creditor Committee to issue an MoU for the IMF Board to meet on Ghana’s programme on January 11, 2024.

One official told Joy Business on condition of anonymity that it should be “placed on record that this delay in getting the IMF Board to meet on Ghana had nothing to do with the government not meeting the conditions under the IMF programme”.

The Finance Minister, Ken Ofori-Atta, in a separate discussion, had told Joy Business that the government was very confident to soon reach a deal with all its bilateral creditors to facilitate the IMF Board meeting on Ghana.

He added that “Ghana will continue with the necessary engagements with allits bilateral creditors to resolve all the concerns that have come up before the new board meeting date of January 11, 2024”.

How much will Ghana get under the IMF programme?

Ghana is expected to get about $3 billion under the IMF programme.

An official release from the IMF Ghana showed that the IMF Executive Board approved, on May 17, 2023, an SDR 2.242 billion (about $3 billion) 36-month Extended Credit Facility (ECF) arrangement for Ghana.

This decision enabled an immediate disbursement of $600 million, equivalent to SDR 451.4 million. The rest is expected to be disbursed in tranches every six months, following programme reviews approved by the IMF Executive Board.