FREQUENTLY ASKED QUESTIONS (FAQs)

AS GOVERNMENT ENGAGES THE IMF FOR A

POSSIBLE FUNDED PROGRAMME
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FAQs

1. What role does the IMF play in member countries?

The International Monetary Fund (IMF) works with member countries to achieve
sustainable growth and prosperity by supporting economic policies/programmes
that promote financial stability and monetary cooperation, which are essential
to increase productivity, job creation, and economic well-being. Currently, the
IMF has a membership of 190 countries.

2. What benefits do member countries have from the IMF?

Member countries enjoy three (3) key benefits, and these are:

i. Surveillance. The IMF monitors the international monetary system and

global economic developments to identify risks and recommend policies for
growth and financial stability. The Fund also undertakes a regular health
check of the economic and financial policies of its 190 member countries
through its annual Article IV Consultations with member countries. In
addition, the IMF identifies possible risks to the economic stability of its
member countries and advises their governments on possible policy
adjustments;

ii. Technical Assistance. The IMF provides technical assistance and training
to governments, including central banks, finance ministries, revenue
administrations, and financial sector supervisory agencies. These capacity
development efforts are centred on the IMF’s core areas of expertise
ranging from taxation through central bank operations to the reporting of
macroeconomic data. Such training also helps countries tackle cross-
cutting issues, such as income inequality, gender equality, corruption, and
climate change; and

iii. Lending. The IMF provides loans (including emergency loans) to member
countries experiencing actual or potential balance of payments problems.
The aim is to help them rebuild their international reserves, stabilize their
currencies, continue paying for imports, and restore conditions for strong
economic growth, while correcting underlying problems.

3. Why has Ghana decided to seek support from the IMF?

Ghana is seeking IMF support for three (3) main reasons:

i. Balance of payments support. Secondly, for concessional/cheaper

financing to shore up international reserves, stabilize the cedi, continue
smooth payments for imports (petroleum products, pharmaceuticals,
medical equipment, among others) and restore conditions for strong

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economic growth (including support for government flagship programmes),

while correcting underlying problems; and

ii. Catalytic effect. providing catalytic effect of accessing additional financing

from third parties (friendly sovereigns/commercial creditors), including
resuming ICM market access sooner than later, facilitating credit rating
upgrades.

4. What is the Enhanced Domestic Programme?

The Enhanced Domestic Programme (EDP) is a 3-year fast-tracked macroeconomic

stabilization programme that seeks to restore policy credibility and achieve fiscal and
debt sustainability. The programme is heavily driven by a mix of robust structural
reforms and revenue, expenditure, and financing policies. The proposed programme
should span a minimum of 3 years and seeks to achieve the following objectives:

i. Improve the credibility of government policy and restore investor confidence in

the economy, thereby, regaining market access, boosting DP disbursements,
and unlocking other financing sources;

ii. Restore debt sustainability and macroeconomic stability to support green

growth, economic transformation and job creation while protecting social
spending;

iii. Strengthen the Central Bank’s Monetary Policy Regime; and

Build buffers to strengthen resilience to economic shocks

5. What type of lending will Ghana get under an IMF-supported

programme?

Government is yet to engage the IMF on the type of support that will be suitable for
Ghana. Typically, IMF lending is for balance of payments support. Therefore,
depending on the assessment of the macroeconomic challenge(s), the IMF’s various
lending instruments are tailored to different types of balance of payments need as
well as the specific circumstances of its diverse membership. For example:

i. All IMF members are eligible to access the Fund’s resources in the General
Resources Account (GRA) on non-concessional terms, but the IMF also
provides concessional financial support (currently at zero interest rates
through June 2021) through the Poverty Reduction and Growth Trust
(PRGT) which is better tailored to the diversity and needs of low-income
countries.

ii. Historically, for emerging and advanced market economies in crises, the
bulk of IMF assistance has been provided through Stand-By
Arrangements (SBAs) to address short-term or potential balance of
payments problems. The Standby Credit Facility (SCF) serves a similar
purpose for low-income countries.

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iii. The Extended Fund Facility (EFF) and the corresponding Extended
Credit Facility (ECF, which is what Ghana was offered in 2015), for low-
income countries are the Fund’s main tools for medium-term support to
countries facing protracted balance of payments problems. Their use has
increased substantially since the global financial crisis, reflecting the
structural nature of some members’ balance of payments problems.

iv. To help prevent or mitigate crises and boost market confidence during
periods of heightened risks, members with already strong policies can use
the Flexible Credit Line (FCL) or the Precautionary and Liquidity
Line (PLL).

v. The Rapid Financing Instrument (RFI) and the corresponding Rapid

Credit Facility (RCF) for low-income countries provide rapid assistance to
countries with urgent balance of payments need, including from commodity
price shocks, natural disasters, and domestic fragilities.

vi. Reflecting different country circumstances, GRA-supported programmes

are expected to resolve the member’s BoP problems during the programme
period, while PRGT programs envisage a longer duration for addressing
BoP problems.

6. How long will it take for the negotiations between Ghana and the
IMF to be concluded?

IMF-supported programme negotiations take some time to be concluded. Depending

on the availability of data to assess the macroeconomic situation, the readiness and
suitability of the government’s economic programme and nature and feasibility of any
prior conditions to be completed by government, programme negotiations can be
quick or be protracted for up to 6 months or more. Ghana’s 2015 ECF programme
negotiations with the IMF lasted for about 7 months before the programme was
approved in April 2015 by the IMF Executive Board. Government stands ready to
quicken and shorten the negotiation process by sharing relevant data as well as
presenting its enhanced economic programme that will anchor the supported
programme. We do not anticipate challenges with the completion ng any prior
conditions if

7. Will Ghana have to fulfil any IMF Conditionalities?

When a country seeks support from the IMF through a funded programme, its
government agrees to adjust its economic policies to overcome the problems that led
it to seek financial support. These policy adjustments are conditions for IMF lending
and serve to ensure that the country will be able to repay the IMF. The member
country has primary responsibility for selecting, designing, and implementing policies
to make the IMF-supported programme successful. This system of conditionality is
designed to promote national ownership of strong and effective policies. This means
that, in the case of Ghana, the conditionalities are expected to be centered around
our own Enhanced Domestic Programme which the Government is committed to
enforcing.

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8. How much can we get from the IMF and what will the money be used
for?
The total credit for an IMF-supported programme will be expressed a percentage of
the country’s quota. In the 2015 ECF programme, Ghana was granted 180% of its
quota, which was equivalent to US$918mn released in equal tranches after every
successful review. In addition to the quota norms, the IMF also uses market access
and other key criteria to assess the type of funding needed by a country. This is
primarily due to cost implications involved in both resources (PRGT and GRA) and
how the interest cost will impact on debt sustainability, following IMF lending.
Typically, a country with significant outstanding exposure to the IMF will be
constrained by how much additional financing that country can access. Ghana falls
into that category. Ghana’s outstanding exposure to the IMF is one of the highest in
the sub region. Which means under the PRGT, Ghana will be constrained in terms of
how much financial resources to tap into.

However, more recently, the IMF has introduced an innovative blended program
options to cure this constraint. This is called the IMF’s High Combined Credit
Exposure (HCCE) policy. The innovative HCCE establishes annual and cumulative
thresholds for high combined credit from the GRA and the PRGT above which certain
substantive and procedural requirements would have to be satisfied. The HCCE then
allows qualifying countries to access from both PRGT and GRA and hence qualifying
countries can access significant financing beyond what existing quotas can allow.

Benin is the first case that has reached agreement under this new HCCE (an
ECF/EFF blend). And it was approved for Benin to help the country deal with pressing
financing needs related to security, Covid-19 scars, and the war in Ukraine, as well
as help to anchor the national development plan.

Given the above, it is believed Ghana could easily be considered under this new
HCCE (a potential ECF/EFF blend) given that Ghana faces similar challenges to what
Benin is facing. Benin’s program is expected to last for 42 months.

Under the HCCE, it is expected that Ghana could have a blended ECF/EFF program
and get more than the US$1 billion, which was approved for the last ECF facility, but
not exceeding US$3 billion.

9. Does going to the IMF mean suspension of government

programmes and expenditures?

NO. The member country has primary responsibility for selecting, designing, and
implementing policies to make the IMF-supported programme successful. This
implies that, government programmes in line with its EDP will still go on as planned
insofar as it is efficient and does not over-burden public finances.

10. Why is government going to IMF now and not earlier?

The primary conditions that necessitate an IMF-supported programme did not exist
earlier. For a country to seek an IMF support, it would need to have a balance of

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payments challenge. A few months ago, the conditions that pertain today and the
outlook is considerably different from six months ago. The IMF in April 2022 revised
its economic forecasts and is predicting that global economic recovery from
coronavirus will run into “multiple challenges” this year, warning of lower growth and
higher inflation. These were not known at the beginning of the year and were not
factored in our baseline projections. Given what we know now from the data and by
assessing the impact of economic growth forecast downgrades in the world’s two
largest economies, China and the US, and their policy responses to the challenges,
spells doom for many developing and emerging markets. These developments have
substantially changed our own assessment of the economic outlook necessitating the
decision to engage the IMF for support. This will help us considerably to weather an
impending economic storm.

11. Will government terminate the E-levy because IMF will give Ghana
money?

NO. The IMF lending to Ghana will be for balance of payments support (i.e. to shore
up the international reserves). Government is committed to ensuring the smooth
operationalisation of all taxes including the e-levy to ensure that in addition to the
IMF’s resources, government can continue to support its developmental goals on its
own while ensuring that tax-to-GPD ratio increases to the peer range of 16%-18%.
An IMF-supported programme is likely to encourage the government to investigate
the factors hindering the success of the e-levy (including by providing technical
assistance if needed) and come out with strategies to improve it. Additionally, other
tax measures could be considered for the medium-term.

12. Is Ghana facing a crisis?

Yes, although not fully blown. The whole world including Ghana is facing a crisis
although each country is at a different stage (countries like Ghana are at an early
stage while countries like Sri Lanka have a fully blown economic crises). To quote
the IMF Managing Director “To put it simply: we are facing a crisis on top of a crisis.
First, the pandemic: it turned our lives and economies upside down—and it is not
over. The continued spread of the virus could give rise to even more contagious or
worse, more lethal variants, prompting further disruptions—and further divergence
between rich and poor countries. Second, the war: Russia’s invasion of Ukraine,
devastating for the Ukrainian economy, is sending shockwaves throughout the
globe”.

13. At what stage is Ghana’s economic crisis?

Ghana’s economy is facing external shocks emanating from the scarring effect of the
COVID-19 pandemic and the Russian-Ukraine war resulting in:

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i. High and rising inflation. Imported inflation passthrough because of

supply chain disruptions which has increased the cost of raw materials
(including fertilizer, refined oil products and metals) needed for production
astronomically across the globe. In Ghana fuel price increases permeates
all aspects of our lives (from transportation to food) and this is largely the
reason why Inflation has increased to 27.6% at the end May 2022 compared
to 7.5% same period last year. Both Food (30.1%) and Non-Food inflation
(25.7%) are rising but food inflation is rising faster. Transport recorded the
highest inflation for the period at 39.0%; and Inflation for imported goods
was 28.2% whilst inflation for locally produced items was 27.3%. In
advanced economies, inflation has risen to all-time highs sparking protests
on the rising living conditions across the Europe, Latin America and SSA;

ii. Tightening financing conditions from less accommodative monetary

policy stance. Closely linked to the inflation problem is the less
accommodative stance from central banks across the globe including our
own Bank of Ghana in their bid to curb inflation, the depreciation of the cedi
and signal high returns on government instruments to attract and/or retain
capital inflows (on the back of the US Fed policy rate hikes which is more
attractive to investors given that us government instruments are by far the
safest debt instruments). This is causing tighter and expensive financing
conditions and leading to the inability of most government’s across the
globe including Ghana to raise the needed financing to fund government
programmes;

iii. Exchange rate depreciation. Currently the Bank of Ghana reports an

exchange rate depreciation of 24.5% (year-to-30th June, 2022);

iv. Elevated debt burden with high debt service. Public debt to GDP ratio
increased from 54.2% in 2017 to 61.2% in 2019 to 74.4% in 2020 and
increased further to 76.6% at the end of 2021 reflecting some key events
over the period: i) impact of COVID-19 spending interventions leading to
high deficit and financing of about 15% in 2020; ii) the banking sector
cleanup cost (circa GHS25bn since 2018); iii) energy sector IPPs payments
(circa GHs16bn and counting); iv) Cedi depreciation - provisional data
indicates that the public debt stock stood at Ghs387.9 billion (77.2% of
GDP) at the end of April, 2022 up from Ghs328.04 billion (71.5% of GDP)
recorded in April 2021 driven largely by the impact of the exchange rate
depreciation; and

v. Widening Eurobond spreads. Spreads of our sovereign bonds and loss

of investor confidence in the economy from ratings downgrades (also typical
to other emerging and developing countries).

All these adverse economic events have negated the gains made prior to the
pandemic. Nonetheless, the strong foundation formed prior to the pandemic has kept
the economy afloat until now when we see the possibility of a fully blown economic
crisis. To avert this crisis from even materializing, government is taking the
precautionary step in engaging the IMF to support its enhanced domestic economic

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programme with the suitable amount of financing so that Ghana can weather the
storm and protect its citizens as it embarks on its structural reforms and economic
adjustment.

14. What was the state of Ghana’s economy before the pandemic?

Prior to the pandemic (2017-2019), macroeconomic stability was largely restored,

and growth rebounded strongly in response to government’s prudent macroeconomic
management, growth enhancing and employment creation flagship programmes and
social protection interventions.

i. Growth averaged 7% between 2017-2019 from 3.5% in 2016;

ii. The fiscal deficit was brought under 5% of GDP and primary balance was
positive for three straight years;

iii. inflation moderated from 15.4% in 2016 to single digits (7.9%) at the end of
Dec 2019;

iv. Trade Balance turned positive for four straight years;

v. Current account deficit narrowed significantly;

vi. The reserve position was strong with Gross International Reserve cover of
between 3.6 and 4 months of imports;

vii. The exchange rate was relatively stable

viii. The progress made by the country also attracted credit rating upgrades and
improvements in credit outlook (S&P upgrade from B- with positive outlook
to B with stable outlook in 2018 and Moody’s change in outlook from B3 with
negative outlook to B3 with stable outlook in 2017);

ix. Government instituted several structural measures including the passage of

the Fiscal Responsibility Act in 2018 to constrain the fiscal deficit to no more
than 5% of GDP with an annual primary surplus, established the Fiscal
Responsibility Council to advise the president on fiscal matters, and the
established the Financial Stability Council to promote financial stability; and

x. The 2015 IMF ECF Programme was successfully completed in April 2019.

15. Why do we repeat going to the IMF? Is the IMF the solution to
economic crisis?

The IMF is the lender of last resort for its member countries, just as the central bank
in Ghana is the lender of last resort to commercial banks who face challenges. The

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IMF assists countries hit by crises by providing them financial support to create
breathing room as they implement their adjustment policies to restore economic
stability and growth. It also provides precautionary financing to help prevent and
insure against crises. The IMF’s lending toolkit is continuously refined to meet
countries’ changing needs.

16. Does an IMF support an admission of incompetence?

It depends on the circumstances leading to the crises. Countries usually

approach the IMF for support when they face more than one type of crisis
as challenges in one sector easily spread throughout the economy. The causes of
crises are varied and complex, and can be domestic, external, or both.

i. Domestic factors include inappropriate fiscal and monetary policies, which

can lead to large economic imbalances (such as large current account and
fiscal deficits and high levels of external and public debt); an exchange rate
fixed at an inappropriate level, which can erode competitiveness and lead
to persistent current account deficits and loss of official reserves; and a
weak financial system, which can create economic booms and busts.
Political instability and/or weak institutions can also trigger crises by
exacerbating economic vulnerabilities.

ii. External factors include shocks ranging from natural disasters to large
swings in commodity prices. These are common causes of crises especially
for low-income countries, which have limited capacity to prepare for such
shocks and are dependent on a narrow range of export products. Also, in
an increasingly globalized economy, sudden changes in market sentiment
can result in capital flow volatility. Even countries with sound fundamentals
could be severely affected by the impact of economic crises and policies in
other countries. The COVID-19 pandemic is another example of external
shock affecting countries across the globe.

Whether the cause is domestic or external in origin, crises can take many different
forms: balance of payment problems occur when a nation is unable to pay for
essential imports or service its external debt repayments; financial crises stem from
illiquid or insolvent financial institutions; and fiscal crises are caused by excessive
fiscal deficits and debt.

17. How long will the IMF programme last?

See Table 1 for a summary of the various facilities (programme types), the purpose,
financing source, duration, and type of conditionality.

Table 1 – Summary of IMF Facilities

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18. How soon can the economy recover by going to the IMF?

The economy is in the process of recovery from the impact of the pandemic and
government is eager to sustain the momentum by finding the required financing to
sustain its economic programme hence the precautionary step to engage the IMF
towards a supported programme. The economy witnessed a strong growth rebound
in 2021 in response to the effective implementation of COVID-19 containment and
recovery measures after growth decelerated to 0.5% in 2020 due to the impact of
COVID-19 pandemic. Growth ended 2021 at 5.4% with an even higher non-oil GDP
growth at 6.9%.

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The economy continued its recovery path from the pandemic in Q1 of 2022 growing
at 3.3% compared to 3.6% in the same period in 2021. However, global events
including the impact of the Russia-Ukraine war is slowing down activity in
manufacturing and agriculture sectors and this is likely to slow down growth. In effect,
the 5.8% y/y growth forecasted for 2022, may not be achieved. Governments fiscal
adjustment is also expected to slow down economic growth as domestic demand,
driven by government consumption wanes. Government consumption grew by 82.1
percent in 2021 as the government continued to inject stimulus to support the
recovery through its GhanaCARES ‘Obaatanpa’ and other flagship programmes.

19. Will Free SHS and some of the big government policies (such as
Agenda 111) be suspended by going to the IMF?

NO. IMF programmes are flexible in response to evolving circumstances. Ultimately,

the IMF encourages governments in their programme design to protect the poor or
vulnerable groups from the impact fiscal adjustment. Free SHS, the School Feeding
programme, among others are good social intervention programmes and it is the lack
of financing and unsustainable debt burdens that could constrain a government's
ability to maintain its level of spending, including social or investment spending. In
our situation, the IMF may ask Ghana to consider curtailing lower priority or non-
productive spending (such as "white elephant" projects) as part of its fiscal adjustment
but to preserve priority social spending, including on health and education. The
objectives are typically aimed at providing a social safety net for the poor and
ensuring that investment spending boosts the economy at a critical time. However,
Government in its Enhanced Domestic Programme has started a review of these
programmes to see how best they can be optimized and become more efficient.

20. With the high level of unemployment currently, won’t the IMF
programme make matters worse for the youth (all others in general)
in terms of gaining employment?

NO. The International Monetary Fund (IMF) works with member countries to
achieve sustainable growth and prosperity by supporting economic
policies/programmes that promote financial stability and monetary
cooperation, which are essential to increase productivity, job creation, and
economic well-being. The IMF does not adopt a ‘one size fits all’ approach. Reforms
are tailored to the problem at hand and further prepared to countries' circumstances.
The decision on employment is usually informed by economics including the
sustainability of the public sector wage bill.

21. How will going to the IMF improve the depreciation of the Ghana
cedi and rising interest rates?

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Usually, before countries sign up for IMF programmes, they may have experienced
some level of investor aversion that results in large sales of domestic assets
including, quite often, the domestic currency. This is also called capital flight. The
public fear is that the crisis will result in high inflation and/or debt defaults. It is
because of these risks that interest rates and the demand for foreign currency
increase. A prudent monetary policy and other confidence-building measures are
needed to help contain the run on the domestic currency and on domestic assets by
curtailing inflation expectations and raising interest rates, thus preventing a disruptive
situation with a free-falling exchange rate and rampant inflation. An IMF programme
then becomes catalytic in improving confidence, thereby reversing the capital flight.
As capital flows back into the country this eventually allows for lower interest rates
again.

22. What are the impacts of the IMF policies on taxation, gov’t
subsidies, gov’t priority policies and social interventions?

Government is expected to design and present its own economic programme for
support by the IMF. The IMF will not design polices for Ghana. However, the IMF is
expected to comment and provide its expert view on the proposed policies.

23. What are the other alternatives available to the government?

Government has the option of implementing the Enhanced Domestic Programme

without an IMF Support. Although, this will have the advantage of flexibility it may not
be perceived as credible and may also lack the ability to attract adequate financing
needed to push through the structural reforms.

24. Why does Ghana have so much debt?

Public debt to GDP ratio increased from 54.2% in 2017 to 61.2% in 2019 to 74.4% in
2020 and increased further to 76.6% at the end of 2021 reflecting some key events
over the period:

i. impact of COVID-19 spending interventions leading to high deficit and

financing of about 15% in 2020;

ii. the banking sector clean-up cost (circa GHS25bn since 2018);

iii. energy sector IPPs payments (circa GHs16bn and counting);

iv. Cedi depreciation. Provisional data indicates that the public debt stock stood
at Ghs387.9 billion (77.2% of GDP) at the end of April, 2022 up from
Ghs328.04 billion (71.5% of GDP) recorded in April 2021 driven largely by
the impact of the exchange rate depreciation.

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25. Will the IMF solve the rise in inflation?

The design of the programme will address inflation through strong and credible fiscal
adjustment and reduction in government borrowing.

26. Is the IMF facility going to be a loan or a Grant?

The facility will be a highly concessional loan with the following likely terms of 0%
interest rate, moratorium on repayment for up to 5 years, and a repayment period of
20 year. Even if Ghana is to access a non-concessional facility from the Fund, the
terms of the loan is considerably better than loans contracted on the market.

27. Does Ghana currently owe the IMF, and won't any new facility
increase our debt position?

Ghana’s exposure to the IMF is SDR1,347.69 million as at March 31, 2022. A new
facility from the IMF will add on to our existing debt but this is cheaper than
commercial loans.

28. Will the credit ratings of Ghana improve by going to the IMF?

Yes. One of the key reasons why Ghana was downgraded by Fitch was on the
grounds of a decline in international reserves further deterioration in fiscal liquidity
conditions. An IMF programme will help address these concerns by signalling that
government’s domestic economic agenda is credible and will also help catalyse
external financing.

29. If the economic challenges are caused by covid and the ongoing
War, how will going to IMF help Ghana?

Global external shocks resulting from the scaring effect of the Covid-19 pandemic
and the Russian-Ukraine War continue to weigh heavily on inflation, ex-pump prices,
transportation fares, food inflation, and tight financing conditions. An IMF programme
will ease the financing conditions and catalyse other financing from friendly sovereign
nations.

30. What percentage of the current challenges will be addressed if

given the opportunity to be with IMF?

An IMF-supported programme will:

i. immediately signal policy credibility and promoting fiscal discipline;

ii. access direct financing from the Fund to address our BoP needs;

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iii. providing catalytic effect of accessing additional financing from third parties
(friendly sovereigns/commercial creditors), including resuming ICM market
access sooner than later, facilitating credit rating upgrades

All these are critical to the success of Government’s Enhanced Domestic Programme.

31. Why the sudden turnaround from the slogan Ghana without aid?

Government has not abandoned its pursuit of a Ghana Beyond Aid. The world has
been hit with major shocks which has impacted Ghana. Countries go to the IMF for
support when they face challenges and want the needed support to undertake its
economic programme but lacks the required funding. An IMF programme is expected
to give us the breathing room to pursue stronger structural reforms that will eventually
help Ghana achieve the targets set out in the Ghana Beyond Aid charter.

32. What will be the sustainability of the economy after IMF have
handed over the economy to Ghana again?

After successfully completing the last Extended Credit Facility Programme (ECF) in
2019, Government instituted several structural measures including the passage of
the Fiscal Responsibility Act in 2018 to constrain the fiscal deficit to no more than 5%
of GDP with an annual primary surplus, established the Fiscal Responsibility Council
to advise the president on fiscal matters, and the established the Financial Stability
Council to promote financial stability. These structures have helped the economy to
hold up well compared to many of its peers even in the face of a global crises.
Government expects to introduce new structural reforms and strengthen the relevant
existing ones throughout the programme so that Ghana economy will remain robust
in future when hit with a crisis.

33. What is the long-term recovery plan for Ghana's high debt ratio?

Government has been pursuing a fiscal adjustment programme on the back of

revenues and expenditure rationalization policies as well as opting for cheaper
financing options since 2021 and so far, this has largely been successful with the
fiscal deficit declining to 11.4% of GDP in 2021 from 15% in 2020. The deficit is
estimated to decline further to 7.4% of GDP and further down to 4.4% of GDP by
2024 all other things being equal. These fiscal policies and other real sector policies
to boost economic growth will help reduce the debt-to-GDP ratio.

34. What's the plan for financing our debts in the long-term?

A successful programme engagement with the IMF is expected to foster a quick

return to the International Capital Market and catayse other commercial financing.
This will help raise the needed financing to amortize our debt.

35. Has Government been dishonest about the state of affairs of the
nation?

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Government has not been dishonest about the state of affairs of the economy. The
government has always acted swiftly based on data and the analysis. Therefore, in
March, following a Cabinet retreat that considered the state of the economy,
government approved additional discretionary expenditure cuts up to 30% to contain
the deficit. Also, the BoG deployed its monetary policy tools including raising the
policy rate by 450 basis points cumulatively since February till-date.

36. Are there any plans of cancelling the E-levy since it’s not yielding?

No. Despite its underperformance so far, government has been reviewing its
implementation modalities to minimize the avoidance of the e-levy by users. It is
expected that a common platform being rolled out in July will greatly boost the
collection of the levy.

37. Is the IMF programme necessary? Have all other avenues been
explored?

Yes. Government needs financing assurances to be able to support its domestic

economic programme. Currently, these financing assurances do not exist given that
the Ghana has limited access to the International Capital Market. On the other hand,
an IMF-supported programme will come with financing assurances which is needed.

38. What are the terms of the bailout?? What will the country lose, and
what will the country gain?

This is not bailout. Should the negotiations be successful, the IMF will support the
Government’s Enhanced Domestic Economic Programme with financing as well as
work with Ghana to achieve sustainable growth and prosperity.

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