The International Monetary Fund (IMF) has come to the defence of the Bank of Ghana (BoG), asserting that the current financial state of the regulator will not hinder its ability to carry out monetary policy operations.
The IMF has consistently stated that the Bank of Ghana’s ongoing financial situation will not impact its monetary policy operations and core responsibilities.
This affirmation was outlined in a recent update released by the IMF concerning Ghana’s program with the organization.
In its latest Q&A session regarding Ghana’s program, the IMF acknowledged the challenging financial circumstances faced by the Bank of Ghana.
Nevertheless, it emphasized that these challenges will not obstruct the central bank’s commitment to fulfilling its policy obligations, including its efforts to gradually bring down the inflation rate to its target of 8 per cent.
The IMF further highlighted that the Bank’s revenue is projected to adequately cover the operational expenses associated with its monetary policy.
The statement also revealed that the Bank of Ghana’s net equity is projected to witness substantial improvement over time, ultimately returning to positive territory, acknowledging the role of the Bank of Ghana’s extensive involvement in the Domestic Debt Exchange Programme (DDEP) in contributing to its negative equity.
Discussing the Domestic Debt Exchange Programme, the IMF disclosed that the completion of the second round of exchanges, encompassing cocoa bills, domestic dollar bonds, and pension funds, is expected to bring the process related to domestic debts to a conclusion.
However, focusing on external debts, the IMF provided insight into the next steps revealing that the Official Creditor Committee for Ghana, operating within the G20 Common Framework, is now poised to collaborate with the authorities to establish a mutual agreement on the precise modalities for official creditors to provide debt relief in accordance with the parameters outlined in the Fund’s program.