COVID-19: IMF’s Executive Board approves $1 billion to Ghana in fight against pandemic

COVID-19: IMF’s Executive Board approves $1 billion to Ghana in fight against pandemic

- The International Monetary Fund (IMF) has approved a $1 billion package for Ghana to combat the coronavirus

- The IMF revealed that the approval was given in the light of measures Ghana has implemented in the fight against the virus

- It added that it expects Ghana's budget deficit to widen given its reduced revenue and increased spending in relation to the virus

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The International Monetary Fund (IMF) has given its approval for a $1 billion credit facility to Ghana to combat the coronavirus pandemic that has ravaged the economy and inflicted hardship on Ghanaians.

The IMF, on Monday, April 13, 2020, approved the fund, which would be drawn under the Rapid Credit Facility.

The outbreak of the coronavirus has negatively impacted Ghana’s economy and has led to a slowdown of growth, the tightening of financial conditions and placed pressure on the exchange rate.

READ ALSO: Parliament approves GHC1.2 fund for Coronavirus Alleviation Programme

This, the IMF noted, has led to huge government and external financing needs.

The IMF reports that the Ghanaian government has responded to the outbreak in a timely manner and has made provisions for affected households and businesses.

The $1 billion fund is expected to be used to address urgent fiscal and balance of payment needs of the country.

It would also be used to improve confidence in the country’s economy and mobilise support from other development partners.

The IMF revealed that Ghana’s budget deficit is expected to widen in 2020, taking into consideration the reduced government revenues and increased spending needs in relation to the pandemic. earlier reported that Investment firm, Goldman Sachs, has predicted that sub-Saharan Africa would require about $75 billion to meet its funding needs as the coronavirus continues to affect economies all over the world.

The firm is convinced that the most severe impact of the crisis will be on already stretched fiscal balances.

The report added that there is a likelihood of a rise in budget deficits from an average of around 3.5% to high single digits.

This could become the reality even before any measures to soften the economic effects of the coronavirus takes place, a Bloomberg report shows.

READ ALSO: New AU report shows Africa could lose $270 billion dollars due to COVID-19

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