We are not going to IMF for bailout – Ofori-Atta

The Finance Minister, Ken Ofori-Atta, has rejected reports that government is seeking to return to the International Monetary Fund (IMF) for programme support and bailout.

Speaking in an interview with Joy Business in Accra on Monday, he said there is “absolutely nothing on the table.”

This was after a meeting with visiting African Development Bank officials.

There have been reports that government is in the process of going to the IMF for some programme support to address the current pressures on revenue, rising debt stock and “troubling budget deficit.”

Some financial experts and international research firms believe that the recent decision of some offshore investors to get out of Ghana’s bonds is due to concerns about the fiscal outlook, which may put further pressure on government’s finances.

They claim this development may force the government to turn to the IMF for support to bring about the needed stability and what some describe as “policy credibility.”

A Bloomberg survey conducted recently, also said Ghana may have no option than to return to the International Monetary Fund (IMF) for financial support if its debt continues to rise.

The debt, which is presently a little above ¢335 billion, continues to surge and create problems for the economy.

According to the survey, the country might have to pay a higher premium if it returns to the international capital market next year to issue a Eurobond.

Ghana’s credit-risk premium soared to the highest since the start of the COVID-19 pandemic ahead of next month’s budget.

“Do they still have access to the Eurobond market at these levels? Could they issue one at a reasonable price?”  Neville Mandimika, an Economist and Fixed Income Strategist at FirstRand Bank in Johannesburg said.

But the Finance Minister noted that the government was seeking to issue Eurobond in 2022 to deal with the funding gap.

He added that it’s an option being considered by government together with initiatives.

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