IMF wants Sinohydro, COCOBOD loans added to existing debt stock

Reports indicate that the International Monetary Fund (IMF), as part of the country’s debt stock, wants government to add the $2bn Sinohydro loan from China and the $1.5bn COCOBOD syndicated loan taken for the 2021/2022 season.

According to the IMF, this is to give a comprehensive picture of the country’s total debt stock.

The inclusion of the $2bn Sinohydro loan and the $1.5bn syndicated loan will hike the country’s debt to GDP ratio from the present 78% [GHS 396bn] to over 80% of GDP.

Reports indicate that, government is reluctant to add the $2bn Sinohydro loan to its current debt stock making the argument that, the Sinohydro loan was a barter trade for the country’s bauxite resources.

Meanwhile, a statement released by the Ministry of Finance on Monday, September 26, noted the Government of Ghana is putting together a comprehensive post Covid-19 economic programme which will form the basis for the IMF negotiations.

The programme seeks to establish a macro-fiscal path that ensures debt sustainability and macroeconomic stability underpinned by key structural reforms and social protection.

According to the Ministry, a key prerequisite for an IMF programme is confirmation that Ghana’s debt is on a sustainable path; this will require a comprehensive Debt Sustainability Analysis (DSA), which is currently ongoing.

Government negotiations with respect to the IMF-supported programme is commencing this week and we are optimistic about making progress in our discussions.

“Government remains committed, and shall continue to actively engage all stakeholders, both public and private, in a clear and transparent manner as we seek to fast-track this process,” it stated.

Source: Norvan Report