IMF mission says Ghana economy rebounding

The International Monetary Fund (IMF) logo is seen outside the headquarters building in Washington, United States, September 4, 2018. REUTERS/Yuri Gripas/File Photo

May 14 (Reuters) - A country mission of the International Monetary Fund said on Friday that Ghana has managed its COVID-19 outbreak very effectively and its economy is rebounding with the support of strong policies.

"Policy interventions in 2020 were also critical to safeguard livelihoods and paved the way for a faster rebound of economic activity," said Carlo Sdralevich, the mission head, in a statement following virtual meetings ended on May 12.

He said last year's government actions to contain the pandemic also exacerbated pre-existing budget constraints and public debt vulnerabilities.

Register now for FREE unlimited access to Reuters.com

"The 2021 budget's recent policy pivot towards fiscal consolidation is an important step in the right direction and a difficult one in a pandemic," said Sdralevich.

Fiscal consolidation should focus around debt and debt service reduction while allowing for social, health, and development spending, he added.

The West African country owes the Fund about $2 billion, including $1 billion in pandemic aid funding received in April 2020.

Ghana spends roughly half of its revenue on interest payments, with total debt rising near 80% of GDP. It has nearly $33 billion in marketable debt according to Refinitiv data, of which over $13 billion is dollar-denominated.

Register now for FREE unlimited access to Reuters.com
Reporting by Rodrigo Campos; Editing by Leslie Adler

Our Standards: The Thomson Reuters Trust Principles.