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"Reaching an SLA in these times of global uncertainty is a remarkable achievement" - Ken Ofori-Atta

Minister of Finance, Ken Ofori-Atta has hinted that reaching an Staff Level Agreement in these times of continued global uncertainty is a remarkable achievement particularly when other countries have faced challenges in reaching such fate in these periods.

He made these remarks while addressing Journalists at a joint press conference with the International Monetary Fund (IMF) on a Staff Level Agreement (SLA) for the first review of the IMF-SUPPORTED POST-COVID-19 programme for economic growth.

He said "What occasioned the SLA was a strong performance of the Country in end-June 2023 performance indicators. Quantitative Performance Criteria including on net

international reserves, primary balance, ceiling on nonconcessional borrowing, zero central bank financing and zero collateralised borrowing"

"Indicative Targets on non-oil public revenue, social

protection spending and non-accumulation of payables (on net


"Structural Benchmarks on financial sector strengthening, arrears clearance and prevention strategy and updated energy sector recovery plan. In addition to the 3 structural benchmarks, we also developed a turnaround strategy for COCOBOD to enhance the entity’s financial viability and sustainability"

In addition, the Finance Minister stressed that Ghana also showed strong performance in upcoming performance indicators due end-September 2023.

"A strategy for an indexation mechanism for the Livelihood

Empowerment Against Poverty (LEAP) Benefits; to increase

the beneficiaries to 2.5 million people and from 350,000 to

450,000 households in short order"

"A strategy on the review of Earmarked Funds; A Medium-Term Revenue Strategy- with an impressive performance of our non-oil revenue collections in the first half of the year"

He noted that Cabinet has approved an Affirmative Action Bill;

and Social Protection Bill in line with our commitment to advancing the empowerment of women and to protect the poor and vulnerable in society.

"It is important to note that the SLA is only one aspect of the approval process. We have a few milestones to cross to secure a Board approval between now and November. Notably the agreement on the MoU with the bilateral Official Creditor Committee (OCC). We are optimistic that, once again, our bilateral creditors will deliver the MoU in time for our Board in November as we continue our engagements"

"Let me take this opportunity to say ‘thank you’ to the OCC for delivering the financing assurances that paved the way for Ghana’s Programme approval in May 2023. We also look forward to engaging more with our Eurobond Holders and Commercial lenders and we hope to pursue this in our trip to Marrakesh for the World Bank Annual Meetings and hopefully by year end, we should be able to secure that"

Touching on recent economic developments, he hinted that the macroeconomic environment continues to show strong signs of stability and recovery as Government implements the IMF-supported PC-PEG.

On available data from year-to-date, Ken Ofori-Atta noted that GDP Growth has rebounded strongly averaging 3.2% in first two quarters compared to 3.0% in same period in 2022 mainly on the back of growth in services (avg. 6.3%) and in Agriculture (avg. 6.2%).

"The average growth of 3.2 percent for 2023 Q1&Q2 is higher than the 2023 Revised growth target of 1.5 percent. Latest Price development in August 2023 indicated a fall in headline inflation, after consecutive upward trends since May 2023"

"The Ghana cedi has remained stable from the beginning of the year to date depreciating cumulatively by about 23.5 percent year-to-date compared to a cumulative depreciation of 37.6 percent over the same period in 2022. The cedi has been very stable, especially from February-to-date as the depreciation over that period was only 3.1 percent"

On the Fiscal front, he explained that the primary balance on

commitment basis for H1 2023 was a surplus of about GH¢2 billion compared to a target of a deficit of GH¢4 billion, driven in part by strong non-oil domestic revenues and rationalised spending.

On Non-Oil Public Revenue for the period was GH¢50.1 billion compared to a programme target of GH¢49.8 billion, he stated.

"The MPC maintained the Monetary Policy Rate at 30.0 percent at the 114th MPC meetings which ended on the 25th Sept 2023"

"Although inflation is expected gradually decline towards the target band over the medium-term barring unanticipated shocks, rising international crude oil prices and adjustments to utility tariffs remain a risk to the inflation outlook which would have to be managed through monetary policy vigilance; and Gross International Reserves (GIR) stood at US$2.1 billion equivalent to 1.0-month import cover, compared with US$1.5 billion (0.6 month of import cover) recorded at the end of December 2022"

"The three concluded debt exchanges included, the exchange of US$-denominated local bonds (US$ 742m, with a participation ratio of 91.7%), of the bills issued by the Cocobod

(GHS 7.7bn, with a participation ratio of 97.4%), and of Pension

Funds holdings of Treasury Bonds (GHS 29.6bn, with a

participation ratio of 95.3%)"

Taking his turn, Governor of the Bank of Ghana, Dr. Ernest Addison said "We have all established that the very decisive measures put in place by the Government and the Bank of Ghana have started yielding results, signaling a faster than expected turnaround which needs to be sustained as we reset the economy"

"More specifically: Non-Food inflation has dropped significantly by 19 percentage points, Food inflation has also by some 8 percent, Core inflation, which measures underlying inflation, is also decelerating at a fast pace"

"From the beginning of the year to date, the Bank of Ghana has built reserves of about US$650 million instead of a programmed drawdown of US$98 million"

The Governor noted that looking ahead, the Bank of Ghana

will continue to maintain a tight monetary policy stance until it is confident that inflation is firmly anchored and aligned with the disinflation path agreed in the program.

"There would be challenges and difficulties as we work towards sustaining these gains but we remained focused and committed to the reforms and prudent policies to ensure the full benefits of this program are achieved"

Story by: Joshua Kwabena Smith



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