Press Release No. 07/152

Press Release: Statement by IMF Deputy Managing Director Takatoshi Kato at the Conclusion of his Visit to Ghana

July 3, 2007

Mr. Takatoshi Kato, Deputy Managing Director of the International Monetary Fund (IMF), made the following statement today in Accra:

"I am delighted to have had the chance to visit Ghana. I am grateful to President John Agyekum Kufuor for inviting me to the African Union (AU) Summit on the "Grand Debate on the Union Government, " and for the Ghanaian authorities warm hospitality. I am also grateful for the opportunity I have had to meet with a wide spectrum of other leaders, including the Presidents of Madagascar, Nigeria, and Zambia, and the Vice President of the Seychelles.

"During my brief stay here, I also had a fruitful exchange of views with representatives of the Ghana Investor Advisory Council and development partners. And I was able to see first hand the fine work being done at the Teshie Orphanage in providing a home for deprived children and in helping educate them.

"I have specifically come to the region to hear from these leaders and others about their concerns and priorities, and how they feel the IMF can better help them address the economic challenges facing their countries. I would like to express my sincere thanks to all the people who made time to meet with me.

"With regard to the African Union Summit, I particularly welcome the importance the AU leaders attached to accelerating regional integration. Establishing a unified market by eliminating trade barriers and impediments to labor mobility could boost regional economic potential. It is important, however, to ensure that regional integration will pave a way for integration into the global economy.

"In my discussions with the African leaders, they assured me that they strive hard to gear policies in their countries toward the achievement of the Millennium Development Goals, but noted that the success in fighting poverty requires efforts from developing and industrial countries alike. I agreed, noting that harnessing Africa's immense potential is a global priority for the 21st century.

"The higher growth path on which Africa has embarked in recent years is foremost the result of improved policies and increased reform efforts in many countries in the region. It provides hope that we can realize our shared vision for the continent, the vision of an Africa with more growth, employment, higher living standards, and less poverty and deprivation. I agreed with the African leaders that progress on realizing this vision hinges on two pillars: the international community, including the Fund, providing an enabling environment that rewards the efforts of a resurgent Africa; and African leaders meeting their responsibilities to provide a sound economic and equitable environment for Africans to pursue their livelihoods. I emphasized that the IMF is committed to working with low-income countries through policy advice, capacity building, and financial assistance. I also underlined the importance of the developed world to deliver on their commitments on bilateral aid as well as for improved market access for African countries and expanded trade.

"Separately, I met with President Kufuor and congratulated him on Ghana's strong economic track record and expressed support for the authorities' ambitious policy agenda. Economic growth in Ghana is strong, inflation has declined, measures are being taken to preserve fiscal discipline, and structural reforms are yielding results. The President and his economic team conveyed to me their firm commitment to preserving fiscal control and macroeconomic stability and their determination to press ahead with the reforms that are needed to accelerate growth, reduce poverty, and meet the Millennium Development Goals. The authorities are taking the appropriate corrective measures to address the 2006 fiscal slippage. They are also moving to resolve the energy shortages and other difficulties in the sector by securing emergency supplies, making investments, and moving toward full cost-recovery pricing. The recent discovery of oil potentially opens great opportunities for Ghana. I welcome the authorities' intention to use this resource carefully.

"I note the merits of Ghana's plan to access international capital markets for high-yielding public investment projects, as long as borrowing is gradual and consistent with keeping debt sustainable. The Fund will continue to support the country as it builds capacity for debt management.

"My discussions with the Ghana Investor Advisory Council, in particular, highlighted the importance of the private sector in accelerating growth. In the context of the government's strategy of large infrastructure projects to raise growth potential, we discussed the useful role of Public Private Partnerships, provided they are underpinned by strong legal and management frameworks and adequate risk sharing. We agreed on the importance of structural reforms, in public financial management, the financial sector, and civil service. These, together with progress on divestiture and the business environment, will help the government to deliver quality services more efficiently and the private sector to contribute to increased productivity and growth."