MPs urged to support government in securing IMF Board approval

Mr Ken Ofori-Atta, the Finance Minister, has appealed to Members of Parliament (MPs) to support the Government in efforts to secure the International Monetary Fund (IMF) Board approval to restore macro-economic stability in the country.

That would ensure debt sustainability and provide critical social protection for the benefit of Ghanaians.

Mr Ofori-Atta made the appeal on the Floor of Parliament, when he presented the Government’s policy brief on the Domestic Debt Exchange Programme (DDEP).

He said debt operations were a composite part of a broader government response strategy for addressing the current challenges Ghana faces.

“While we continue to secure an IMF programme to boost confidence in the economy, we are complementing this by enhancing our domestic mobilisation efforts,” he said.

In November 2022, the Finance Minister briefed Parliament that Ghana lost access to the International Capital Market (ICM) at the beginning of that year, while, at the same time, budget implementation was confronted with domestic financing challenges at the auction market as well as lower than estimated domestic revenue mobilisation.

“These presented a very challenging macroeconomic environment during 2022, leading to a widened financing gap of the budget and, therefore, became necessary for the Bank of Ghana to fund shortfalls at the auction market to avoid a disorderly default and prevent a deeper crisis,” he said.

Mr Ofori-Atta said under those circumstances, it was necessary for the Government to seek financing from the Bank of Ghana to augment its fiscal operations for the year.

The Central Bank, last week, concluded work on its financial accounts for 2022 and reported that the total overdraft extended to government, that year, was GHC37,956.82 million.

He said in line with Section 30 (6) of the Bank’s Act, 2002, (Act 612), he was informing the Legislature of the financing of the budget by the Bank of Ghana.

The Domestic Debt Exchange exercise and the External Debt Restructuring Programme would make such financing unnecessary, going forward in 2023 and beyond.

“Mr Speaker, all these efforts would be greatly enhanced if the Income Tax (Amendment) Bill, Excise Duty and Excise Tax Stamp (Amendment) Bills as well as the Growth and Sustainability Levy Bill, which are outstanding in this august House, could be prioritised and passed.”

Mr Ofori-Atta said the passage of those bills would enable the Government to complete four of five agreed Prior Actions in the Staff Level Agreement.

This is because Tariff adjustment by the Public Utility Regulatory Authority, Publication of the Auditor-General’s Report on COVID-19 Spending, and Onboarding of GETFUND, District Assembly Common Fund and Road Fund on the Ghana Integrated Financial Management Information System (GIFMIS) had all been completed.

“Mr Speaker, I cannot emphasise enough, the need to secure the Board Approval for our IMF Programme by the end of March, 2023,” he said.

“I, therefore, entreat the House to prioritise the approval of the outstanding Revenue Bills and the various concessional facilities.”