The International Monetary Fund (IMF) has pleaded with wealthier nations to support Ghana and other weaker nations to extricate themselves from the shackles of debt.
The call comes at a time when the fund has seen a $1. 6 billion shortfalls in its funding in the face of the seemingly global economic crises where funding to debt-distressed countries was at its highest.
Speaking ahead of the IMF and World Bank Spring Meetings in Washington, Kristalina Georgieva, the IMF’s Managing Director said the fund and wealthier countries needed to make it easier for vulnerable ones to restructure their debts to help minimise the effects of the debt crises on lives and livelihoods of their people.
According to Ms Georgieva in a curtain raiser speech before the meetings that opened yesterday, Monday, April 10, 2023, developed economies must also commit more resources to the fund’s Poverty Reduction and Growth Trust (PRGT) – a concessionary lending window for low-income countries (LICs) – to help strengthen the global response to debt vulnerabilities.
The one-week meetings in Washington D.C. in the United States of America (USA) come off at a time when Low-Income Countries (LICs) are battling extreme debt pressures worsened by the COVID-19 pandemic and Russia’s invasion of Ukraine.
Ghana, with a debt stock of GH$575.7 billion in November last year, is one of more than 10 LICs in debt distress.
The country defaulted in servicing its debt last year and is now working with bilateral creditors to restructure their component to be able to earn a US$3 billion IMF assistance to help slow down inflation, prop up the currency and return the economy to the path of growth.
Although discussions with some bilateral creditors under the G20 Common Framework are underway, talks with China, which holds US$1.9 billion of Ghana’s debts have dragged, fuelling doubts over the country’s ability to secure a package before May.