COVID-19: Ghana Secures $500m Debt Repayment Freeze From World Bank

Nana Addo Danquah Akufo-Addo – President of the Republic of Ghana

Ghana has secured a $500-million dollar freeze in debt and interest repayment for the rest of this year from the World Bank, President Nana Akufo-Addo has announced.

This forms part of a Pan-African effort to bring debt relief to Africa due to the economic impact of the novel coronavirus pandemic, the President said.

Addressing the nation on Sunday, 19th April, 2020, the President stated that, “The Minister for Finance, together with his counterpart in South Africa, as co-Chairs of the Committee of African Finance Ministers, have been leading a Pan-African effort to bring debt relief to the continent in these difficult times.”

“Last Friday, they achieved a nine-month debt standstill from the World Bank for all qualifying members of the International Development Association (IDA), starting from 1st May, 2020, totalling some forty-four billion United States dollars ($44 billion) for the countries of Africa,” he added.

He further noted that, “In the case of Ghana, this amounts to a freeze in principal and interest payments for the year, amounting to some five hundred million United States dollars ($500 million).”

The President also stated that this will create greater fiscal space to help make the Ghanaian economy much more resilient.

Whiles commending Ken Ofori-Atta, who is leading the continent’s debt relief efforts for his hard work and outstanding leadership, the President urged him ‘to leave no stone unturned to achieve an even greater and comprehensive debt relief programme for Africa.’

This was the President’s seventh national address since the outbreak of the pandemic in Ghana.

Other Financial Interventions

The Government has also received the three billion Ghana cedis credit and stimulus package from commercial banks, under the auspices of the Ghana Association of Bankers, with support from the Bank of Ghana, to revitalise Ghanaian industries.

The stimulus package is to offer financial relief to especially the pharmaceutical companies.

Additionally, “the one billion United States-dollar- Rapid Credit Facility, secured from the International Monetary Fund, without any pre-condition, and approved by Parliament, would be used to help close the financial gap created by the COVID-19 pandemic,” the President said.

So far, the Government has allocated a GHS1.2 billion, under the Coronavirus Alleviation Programme, to support households and businesses.

Out of that amount, GHS280 million would be used to provide food for the vulnerable and free water for all Ghanaians in April, May and June.

GHS323 million is being used to motivate frontline health workers leading the fight against COVID-19, while GHS600 million assistance package is for micro, small and medium-scale businesses.

Also, the Government is absorbing the full electricity bills of one million active lifeline customers and granting 50 per cent subsidy to the other categories of power consumers at a total cost of one billion Ghana cedis.

Partial lock–down lifted

The President has lifted the ban on the three-week partial lock-down of COVID-19 hotspots areas – Accra, Tema, Kasoa and Greater Kumasi.

He however stated that the other restrictions, including the ban on public gatherings, public funerals, indefinite closure of schools, closure of the country’s borders are still in force.

He urged the general public to continue observing the social distancing rules, practicing regular washing of hands and the regular use of hand sanitizers. Currently, Ghana has recorded 1,042 cases, with nine deaths and 99 recoveries.

Source: Citibusinessnews.com