Finance Minister, Ken Ofori-Atta says Ghana is in a better position to manage and revive economy more than most African countries hit by the Covid-19 pandemic.
This follows the International Monetary Fund’s (IMF) approval of a $1 billion dollars Rapid Credit Facility to Ghana to aid addressing the outbreak of the coronavirus pandemic in the country.
On Monday, April 13, 2020, the Executive Board of the IMF approved a $1 billion Rapid Credit Facility (RCF) to Ghana.
A statement issued on the IMF’s website says the disbursement is to help Ghana address the urgent fiscal and balance of payments needs that it is facing, improve confidence, and catalyse support from other development partners.
The IMF facility comes with zero interest; with a repayment period of 30 years, and a five-year moratorium.
“The beauty of this is that the rapid credit facility which we went for I think we [Ghana] are the first to have gotten a double quota of a billion dollars and is a zero percent facility, it is 30 years, has 5 and half years moratorium, and it doesn’t come with any conditionalities”, he said.
Ken ofori-Atta added that all the necessary paper works had already begun, and the $1 billion dollars loan should possibly hit the country’s account the end of this week.
Caution against misuse of $1bn IMF loan
Meanwhile, an Economist, Dr. Adu Owusu Sarkodie, has cautioned government against a misuse of the Rapid Credit Facility procured from the International Monetary Fund (IMF).
Dr Sarkodie warned that the country will pay dearly for the loan in the future if government misuses the money.
In an interview with Citi Business, the Economist advised Government to make judicious use of the money.
“We are not in normal times as they said. If they don’t use this fund judiciously, it will come back to haunt us and we will go and pay the loan and not have enough to show for the loan we have contracted.
“So, it’s a question of efficiency, transparency and accountability. We need to make good use of this,” he said.
He further called for stringent measures to be put in place to make sure the IMF loan is used for the intended purposes.
He said that “I think as a country, we should be very serious, we should put in the stringent measures to make sure that we use this fund judiciously to achieve the intended purposes”.
But the Finance Minister has given the assurance that the money will be used for the intended purposes.
“One of the more crucial elements of this is that when you get these shocks on your economy there is usually a liquidity crisis and if you don’t manage that quickly you then get into an insolvent crisis which put you into a tail spend,” he added.