According to the 2023 International Monetary Fund Regional Economic Outlook Report (Sub-Saharan Africa), Ghana’s net international reserves are expected to end 2023 at approximately three weeks of import cover (0.8 months).
This is in contrast to the Bank of Ghana’s Summary of Economic and Financial Data, which estimated Ghana’s reserves for 2023 at 2.7 months of import cover, while the report indicates it stood at a little above two weeks (0.6 months) of import cover in 2022.
The implication is that if foreign inflows cease, Ghana’s economy will suffer significantly as there are only limited dollars in the reserves for balance of payment transactions.
Therefore, the IMF bailout of $3 billion loan is critical for Ghana’s economic stability going forward.
The report predicts that the country’s reserves will increase to about 1.7 months of import cover in 2024.
Only Zimbabwe (0.2 months), South Sudan (0.5 months), and Ethiopia (0.6 months) in Sub-Saharan Africa are projected to have lower import cover than Ghana.
In March 2023, the Bank of Ghana reported that Ghana’s net international reserves had slightly improved to $2.62 billion, about 2.8 months of import cover in February 2023, up from $2.24 billion in December 2022, which was about 2.7 months of import cover.
However, the country’s Balance of Payment had a deficit of $3.63 billion, equivalent to approximately 5% of Gross Domestic Product by the end of February 2023.