Professor Eliplimi Agbloyor, an Associate Professor at the University of Ghana Business School (UGBS), says the $360 million from the International Monetary Fund is not sufficient for Ghana’s reserve.
In an interview monitored by the Ghana News Agency (GNA), the expert said the money extended to Ghana was not enough to address the demand for dollars in the economy.
He urged the government to implement appropriate domestic policies to improve the extent of the Ghanaian reserve since the current 1.7-month import cover was not enough.
“For me, critically, we need to improve the level of our external reserves. Currently, the 1.7-month import cover is dangerously low. Our import cover must be a minimum of 12 months because what is currently available is not enough for us as a country.
“A 12-month import cover will allow a country to withstand global economic shocks. If you observe what happened in the COVID-19 era, countries that had high reserves did not suffer as much as countries with lower reserves. We should put in place policies on the minimum external reserve as a country,” he said.
Ghana is expected to get approval for its third tranche of $360 million when the Executive Board of the IMF meets in June, having reached a staff-level agreement on the second review of the loan-support programme.
At a press briefing in Accra following the conclusion of a staff-level agreement on Ghana’s second review of the three-year Extended Credit Facility (ECF) arrangement, Dr. Ernest Addison, Governor of the Bank of Ghana, said he was optimistic about the Board’s approval in June.
The said money, the Central Bank Governor said, would help to further boost the country’s foreign reserve, which stood at $6.2 billion as of April 5, 2024, and support the attainment of the objectives of the $3 billion loan support programme.
He said the $360 million that would come to the BoG would strengthen the reserves of Ghana.
Dr. Theo Acheampong, an economist and political risk analyst, said the domestic gold purchase by the BoG was essential in building Ghana’s reserve and strengthening the currency.
Source: GNA
