African Reserves Loans

Ghana’s balance of payments deficit hits nearly $2.5 billion in June

Ghana’s balance of payments deficit widened to nearly $2.5 billion in June from $935 million in the first quarter, central bank data showed on Friday. It also showed that foreign exchange reserves fell to less than $3.6 billion from $5.1 billion during the same period.

The figures underscore the dismal state of the Ghanaian economy, which has prompted the government to turn to the International Monetary Fund (IMF) to help stabilize its finances. The West African nation has seen runaway inflation hit 29.8% in June, its debt-to-GDP ratio at 78.3%, while its cedi currency has lost almost a quarter of its value this year.

The crisis has led to protests in the capital Accra and a bitter confrontation with public sector workers over wages. Earlier this month, the Ghanaian government averted a planned strike by public sector workers, reaching an agreement with the country’s main unions to increase the cost of living allowance by 15%. An IMF team visited Ghana earlier this month, but has yet to agree a support package with the government.

Ghanaian lawmakers on Wednesday approved a $750 million loan from the African Export-Import Bank (Afreximbank) and continued negotiations on another loan worth $250 million, as the country seeks to make up for its balance of payments deficit.

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