{
  "title": "IMF Lending Case Study: Ghana",
  "sourceUrl": "https://www.imf.org/en/countries/gha/ghana-lending-case-study",
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  "overlayPath": "/en/countries/gha/ghana-lending-case-study/index.md",
  "summary": "It was the first to free itself from colonial rule, in 1957.",
  "sections": [
    {
      "heading": "Background and macroeconomic problems",
      "content": "- Ghana was described as a success story in sub-Saharan Africa, having cut the poverty rate from 53 percent in 1991 to 21 percent in 2012.\n- By 2015, Ghana faced:\n  - widening current account and budget deficits,\n  - rampant inflation,\n  - a depreciating currency,\n  - credit drying up as interest rates rose,\n  - accumulation of bad loans in the banking system.\n- The root cause was identified as out-of-control government spending, largely to pay salaries of an overgrown civil service."
    },
    {
      "heading": "The IMF-supported program (early 2015)",
      "content": "- The IMF provided a $918 million loan to help stabilize the economy.\n- IMF advisors and the Ghanaian government developed a three-part program:\n  - Restore debt sustainability:\n    - The government limited hiring and wage increases.\n    - Subsidies for utilities and petroleum products were eliminated.\n    - Revenue measures included cracking down on tax evasion and rationalizing exemptions.\n    - New revenue sources included a tax on luxury cars and increased taxes on high earners.\n    - The Public Financial Management Act called for improved accounting standards, procedures, and technology.\n  - Strengthen monetary policy:\n    - The authorities agreed to gradually end central bank financing of the budget deficit.\n    - The inflation-targeting regime was to be fortified.\n  - Clean up the banking system:\n    - An asset quality review revealed significant under-capitalization.\n    - Some banks were recapitalized.\n    - The Bank of Ghana used enhanced authority to wind down insolvent lenders.\n    - The central bank developed regulations to ensure sound underwriting and credit evaluation standards.\n    - Insolvent microfinance institutions’ depositors were paid back."
    },
    {
      "heading": "Outcomes and key statistics",
      "content": "- Trade and budget deficits narrowed.\n- Economic growth:\n  - Growth was 2.2 percent in 2015.\n  - Growth was poised to rise to 8.8 percent in 2019.\n- Inflation:\n  - Inflation was almost 19 percent (earlier period).\n  - Inflation was projected to fall to 8 percent.\n- Fiscal and social impacts:\n  - Cuts to wasteful spending made room for social services, including free secondary education.\n  - For Ghana’s 28 million people, outcomes were described as higher incomes, better job opportunities, and more purchasing power.\n- Remaining vulnerabilities:\n  - Ghana remained largely reliant on foreign financing, exposing it to swings in investor sentiment.\n  - Maintaining fiscal discipline was identified as an ongoing challenge."
    }
  ],
  "bullets": [
    "Ghana was described as a success story in sub-Saharan Africa, having cut the poverty rate from 53 percent in 1991 to 21 percent in 2012.",
    "By 2015, Ghana faced:",
    "The root cause was identified as out-of-control government spending, largely to pay salaries of an overgrown civil service.",
    "The IMF provided a $918 million loan to help stabilize the economy.",
    "IMF advisors and the Ghanaian government developed a three-part program:",
    "Trade and budget deficits narrowed.",
    "Economic growth:",
    "Inflation:",
    "Fiscal and social impacts:",
    "Remaining vulnerabilities:"
  ],
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  "generatedAtUtc": "2026-09-30T19:07:03.054Z"
}