IMF puts Ghana under Post Program Monitoring after the country’s debt levels reach $1 billion

The International Monetary Fund (IMF) has placed Ghana on a Post Program Monitoring (PPM) after exiting the programme.

Finance Minister, Ken Ofori-Atta

This according to the fund is triggered the country’s debt levels which have reached a little over $1 billion.

The action Business Insider SSA understands was taken in June this year.

Another reason that triggered this move was that Ghana’s debt level with the Fund crossed the GH¢400 million mark and for a low middle-income country, it has to be placed on this program to ensure that the debt repayments are not affected in any way.

When a member country borrows money from the IMF, its policies come under closer scrutiny. Once a country has completed its lending program, it may be subject to Post-Program Monitoring (PPM), which is an important part of the Fund’s safeguard architecture. 

PPM is generally expected for all member countries that have substantial IMF credit outstanding following the expiration of their programs. 

The aim is to identify risks to such member countries’ medium-term viability and provide early warnings on risks to the Fund’s balance sheets. Should it become necessary, IMF staff will advise on policy actions to correct macroeconomic imbalances.

Under the PPM, countries undertake more frequent formal consultations with the IMF than is the case under the IMF’s normal surveillance, with a particular focus on macroeconomic and structural policies and risks that have implications for the country’s external viability and capacity to repay the IMF. 

This means that the IMF reports on the economy would be made available to the public and investors, which would indirectly act as a check on government to be prudent with its expenditure. 

This move according to the IMF will give some assurance to investors who were worried about prudent spending and fiscal discipline post-IMF program.

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