$2.22bn IMF-debt: Ghana retains top spot as Africa’s largest debtor to the IMF with 35.3% loan increase

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Accompanied by fiscal challenges and a bid to revive its economy, Ghana’s debt to the International Monetary Fund (IMF) has surged by an alarming 35.3% in the second quarter of 2023. The country has once again secured its position as Africa’s most indebted country to the IMF, according to the IMF’s Quarterly Finances report for July 2023.

As of July 31, 2023, Ghana’s outstanding loans to the IMF reached a substantial Special Drawing Rights (SDR) 1.689 billion, equivalent to $2.227 billion—a staggering $451 million increase from the $1.246 billion recorded just three months earlier, on April 30, 2023.

This sharp rise in debt can be attributed to a $600 million bailout package that Ghana secured from the IMF in June 2023, aimed at revitalizing its economy and mitigating financial challenges. Impressively, despite its increasing debt load, Ghana managed to repay SDR 8 million (about $10.55 million) to the IMF during this period.

Notably, Ghana’s debt exposure to the IMF represents a significant 9.55% share of Africa’s cumulative IMF debt, totaling SDR 17.68 billion.

Furthermore, Ghana’s loans from the Bretton Woods institution are categorized as concessional lending with favorable terms, including low-interest financing, which is critical for the country’s economic recovery efforts.

Meanwhile, the Democratic Republic of Congo and Kenya maintain their positions as the second and third most indebted African nations to the IMF as of July 31, 2023. DR Congo’s debt to the IMF stands at SDR 1.142 billion, while Kenya owes the Fund SDR 1.008 billion. Both nations received disbursements—SDR 153 million and SDR 77 million, respectively—to bolster their balance of payments.

Sudan and Uganda also retained their fourth and fifth positions, with debt exposure to the IMF estimated at SDR 992 million and SDR 812 million, respectively. Uganda, like its peers, benefited from an IMF disbursement of SDR 91 million to support its fiscal stability.

Collectively, the rest of Africa’s debt to the IMF amounts to SDR 11.32 billion, underscoring the regional financial challenges that persist across the continent. Ghana’s escalating debt levels serve as a stark reminder of the delicate balance between economic recovery and managing debt sustainability in the region.