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Ghana meets only 1 of 11 IMF targets

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Ghana meets only 1 of 11 IMF targets

It is emerging that Ghana may have met only one out of the eleven targets set with the International Monetary Fund (IMF) under the extended credit facility program.


The targets were among others to guide the government in achieving key economic growth standards and restore economic stability.

Ghana in 2015, entered into an agreement for 918 million dollars to support her economy.

Citi Business News’ analysis has shown that Ghana’s underperformance in majority of the targets may have triggered the extension by the current government.


The eleven targets comprised; a ceiling on gross credit to government by the Bank of Ghana, a ceiling on wages and salaries, a continuous non accumulation of domestic arrears as well as a continuous non-accumulation of new external arrears.

But it appears government has only been able to meet the condition having to do with the financing of the government’s budget deficit from the central bank.

For the first time, the previous NDC administration in 2016 didn’t seek funding from the central bank to finance its budget deficit.


This has also been confirmed by the Bank of Ghana that it will be cutting back and eventually stop financing the deficit.

For those targets that have not been met, a key one is the rising percentage of the public sector wages and salaries.

For instance, a study of government’s expenditure pattern shows that wages and salaries has risen from an estimated 9 billion cedis in 2015 to a projected 14 billion cedis at the end of 2017.

This also translates into a GDP ratio of 6.7 percent in 2015 to 6.9 percent of GDP by the end of 2017.

For 2017, the government’s budgeted expenditure target is twenty-five percent of the projected expenditure of 55.9 billion cedis.

On debts, Ghana’s total debt stock reached 137.2 billion cedis or 67.5 percent of GDP as at May this year.

Of this, the external component is 73.3 billion cedis while the domestic component is at 63.9 billion cedis.

Meanwhile, the Bank of Ghana’s inflation target is 8 percent plus or minus 2 is expected to be reached by 2018.

This optimism by the central bank is premised on the declining trend in inflation which stood at 11.9 percent in July this year.

Govt ‘forced’ to extend IMF agreement by one year

Meanwhile speaking on the Citi Breakfast Show on Monday September 11, 2017, a Deputy Finance Minister, Kweku Kwarteng suggested that government was compelled by the IMF to extend the deal by one more year.

Mr. Kwarteng explained that though the country couldn’t meet most of the performance targets, the prevailing stance by the Fund to end the agreement in April 2018 warranted a decision to extend it to get the full disbursements as initially scheduled.

Eleven targets set under IMF deal

  • A floor on the primary cash fiscal balance of the government, measured in terms of financing;
  • A ceiling on gross credit to government by the Bank of Ghana;
  • A floor on the net international reserves of the Bank of Ghana;
  • A ceiling on net domestic assets of Bank of Ghana;
  • A ceiling on wages and salaries;
  • A ceiling on the net change in the stock of domestic arrears;
  • A continuous non-accumulation of domestic arrears;
  • A continuous non-accumulation of new external arrears; and
  • A ceiling on the contracting or guaranteeing of new external non-concessional debt

The indicative targets under the programme are as follows:

  • central target rate of inflation; and
  • A floor on social protection spending


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