A comparative analysis of Ghana’s two most recent International Monetary Fund (IMF)-supported programmes has prompted a renewed debate regarding claims that the nation’s current Extended Credit Facility (ECF) arrangement has been derailed ahead of the 2024 general elections. The analysis, conducted by the spokesperson for the NPP Policy Committee on Finance and Economy, Issah Fuseini, asserts that available IMF data indicates the 2015 ECF programme experienced a significantly more severe performance breakdown compared to the ongoing 2023 programme.
Comparing Programme Performance
The report emerges amidst a heightened political discourse following the IMF’s latest staff-level assessment of the Ghanaian economy. Critics have alleged that fiscal pressures leading up to the 2024 elections have pushed the current IMF programme off-track. However, Fuseini’s analysis contends that this conclusion is not supported when juxtaposed with Ghana’s performance under the 2015 IMF arrangement.
Historically, IMF-supported programmes in Ghana have followed a predictable pattern: governments initially commit to fiscal consolidation and economic stabilization targets. Implementation often falters as election-related expenditure pressures intensify. The analysis highlights that while both programmes faced such challenges, the scale and nature of slippages under the 2015 arrangement were considerably more severe.
The 2015 Programme: A Deeper Dive
Ghana entered the 2015 IMF programme during a period of profound economic distress under the Mahama administration. This era was marked by escalating inflation, a rapidly depreciating cedi, widening fiscal deficits, high debt levels, and a persistent power crisis known as “dumsor.” The IMF programme was designed to restore macroeconomic stability, rebuild investor confidence, and set the economy on a sustainable fiscal path through stringent expenditure controls, debt management reforms, and enhanced revenue mobilization.
However, by the IMF’s Fourth Review stage in 2017, Ghana had failed to meet most of the programme’s critical quantitative performance criteria. The report details that by September 2016, Ghana had missed 8 out of 14 targets under the 2015 ECF arrangement. Key indicators that were missed included the primary fiscal balance target, the net international reserves floor, and arrears-related performance criteria, all considered vital anchors of the IMF programme.
Furthermore, the country also fell short of social protection spending targets under the 2015 arrangement, raising concerns about the safeguarding of vulnerable populations during the fiscal adjustment period.
The 2023 Programme: Relative Resilience
In contrast, the analysis argues that performance under the 2023 ECF arrangement has remained comparatively stronger, despite fiscal pressures associated with the 2024 election cycle. According to the report, all end-December 2024 binding performance criteria under the current programme were met, with only two out of eleven monitored indicators missed.
The report acknowledges that the current programme has experienced slippages, notably elevated inflation and the accumulation of payables, particularly in the lead-up to the elections. Inflation reached 23.8 per cent by the end of 2024, surpassing the IMF programme’s upper outer consultation band of 22 per cent and triggering a Monetary Policy Consultation with the IMF Executive Board.
Additionally, the government accumulated GH¢45.604 billion in payables against a zero ceiling. This accumulation was largely attributed to spending commitments by ministries, departments, and agencies operating outside the official GIFMIS expenditure control system.
Despite these challenges, the analysis maintains that the current programme remains fundamentally intact. Ghana continued to meet all core binding performance criteria, including those related to reserves, debt ceilings, and central bank financing.
Key Distinctions in Performance Metrics
A significant distinction highlighted in the report is Ghana’s external reserve position under both programmes. The analysis states that Ghana failed to meet the net international reserves target under the 2015 ECF programme, signaling severe pressure on the country’s external sector at that time. Conversely, under the 2023 arrangement, Ghana reportedly exceeded the reserve target, recording net international reserves of US$1.719 billion against an adjusted programme floor of US$886 million by the end of 2024.
The report also points to improved discipline in central bank financing under the current programme. While both the 2015 and 2023 programmes maintained zero direct government financing by the Bank of Ghana, the current programme demonstrated stronger institutional compliance. The ceiling on Bank of Ghana claims on government and public entities was successfully maintained throughout the review period.
Regarding debt management, the 2023 programme also showed better compliance with external borrowing limits and debt ceilings established under the IMF arrangement. Debt-related criteria were not the primary source of slippages in either programme, although the 2015 arrangement suffered from broader fiscal and structural weaknesses.
Economic Growth and Fiscal Slippage Nature
The analysis further draws attention to differing economic growth outcomes. Ghana’s economy grew by only 3.5 per cent at the end of 2016 under the 2015 ECF arrangement. In contrast, the economy expanded by 5.8 per cent at the end of 2024 under the current programme, navigating global economic uncertainties and domestic fiscal pressures.
The nature of fiscal slippages also differed significantly. Under the 2015 programme, the country breached formal arrears ceilings and failed to prevent the accumulation of new domestic arrears, necessitating government commitments to clear outstanding arrears through audits and repayment plans. Under the 2023 programme, the fiscal challenge manifested primarily through the accumulation of payables rather than direct breaches of external arrears performance criteria.
This distinction, according to the analysis, suggests a degree of institutional learning and improvement in expenditure management systems, even as election-year spending pressures persist as a recurring challenge.
Implications and Future Outlook
The report concludes that while both IMF programmes encountered implementation difficulties during election periods, the current arrangement cannot be accurately described as “derailed” in the same vein as the 2015 programme. Instead, the analysis posits that Ghana has demonstrated measurable institutional progress in areas such as reserve accumulation, debt management, central bank financing discipline, revenue mobilization, and the protection of social spending.
However, the report cautions that deeper structural and political economy challenges remain. These include persistent issues in election-year expenditure control, inflation management, and the timely execution of structural reforms. The evidence suggests Ghana has transitioned from what is termed an “overt quantitative derailment” under the 2015 programme to a more contained fiscal management challenge under the ongoing 2023 arrangement.
Moving forward, attention will remain focused on Ghana’s ability to sustain fiscal discipline in the post-election period and to address underlying structural impediments that continue to challenge economic management, particularly in the context of future IMF engagements and broader economic development goals.
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