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Ghana swallows humble pie, begins talks with IMF over dwindling economy

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West African country, Ghana, has swallowed its pride as it made bold steps to commence formal engagements with the International Monetary Fund (IMF), to support the its economy.

Ghana’s president, Nana Addo Dankwa Akufo-Addo, in a statement issued by the country’s information ministry has authorized Finance Minister, Ken Ofori-Atta to begin discussion with the monetary body following a telephone conversation between the Presidenand the IMF Managing Director, Miss Kristalina Georgieva.

According to the statement released on Friday, the cabinet indicated its support for the decision at a meeting on Thursday.

“The engagement with the IMF will seek to provide a balance of payment support as part of a broader effort to quicken Ghana’s build back in the face of challenges induced by the Covid-19 pandemic and, recently, the Russia-Ukraine crisis”. The statement reads.

Recall that in May, Ghana’s Finance Minister, Ken Ofori-Atta recently announced that the West African country is committed to managing its debt without assistance from the International Monetary Fund (IMF).

The country in April 2015 had turned to the IMF for a $918-million loan to support its ailing currency and help stabilize the economy.

It exited the IMF programme in December 2018, and during the 2019 budget presentation to Parliament, the Minister of Finance, Ken Ofori-Atta, assured the country that the government would back the IMF reforms with legal and institutional measures to ensure the irreversibility of the gains made so far.

Other African countries like ZambiaSomalia, and the Benin Republic alre also struggling with their monetary and capital positions and hanging on to international organizations like the International Monetary Fund to get out of the mess.

According to the World Bank, Ghana’s rapid growth was halted by the COVID-19 pandemic, the March 2020 lockdown, and a sharp decline in commodity exports.

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Nigeria climbs to fourth position on World Bank’s list of most indebted nations

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Nigeria has moved into the fourth position of World Bank’s list of countries with the highest debts, according to the Bank’s financisl report released on Monday.

Going by the World Bank Fiscal Year 2022 audited financial statements for International Development Association (IDA), Nigeria now owes a debt stock of $13bn as at June 30, 2022.

The country also moved up one spot from the fifth position it was rated as of June 30, 2021, with an IDA debt stock of $11.7bn.

The global bank also revealed in its audited financial statements that Nigeria has accumulated about $1.3bn IDA debt within a fiscal year, adding that the debt is different from the outstanding loan of $486m from the World Bank’s International Bank for Reconstruction and Development.

What this means is that Nigeria now has the highest IDA debt in Africa, and is only bettered by the likes India with $19.7bn debt, Bangladesh, $18bn
and Pakistan, $15.8bn, all from the Asian bloc.

The Washington-based international Financial Institution also disclosed that Nigeria’s debt which may be considered sustainable for now, is fast growing into a state of vulnerability and could become costly.

“Nigeria’s debt remains sustainable, albeit vulnerable and costly, especially due to large and growing financing from the Central Bank of Nigeria,” it said.

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Nigerian president, Buhari, finally grants approval for Exxon unit acquisition by Seplat

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Nigeria’s president, who doubles as minister for petroleum, Muhammadu Buhari has granted consent to the acquisition of Exxon Mobil’s Nigerian unit by Seplat Energy.

The approval of the $1.28 billion deal was announced in a statement by the presidency on Monday.

In February, Seplat Energy Plc, unveiled plans to acquire the entire share capital of Mobil Producing Nigeria Unlimited (MPNU) from Exxon Mobil Corporation Delaware (USA Incorporated). That includes all of Exxon’s entire shallow water assets in the Niger Delta.

The oil giants are expected to operate the unit’s oil licenses, supporting Nigeria meet its OPEC production quota in the short term as well as accelerate the development of gas resources in the area.

Nigeria recently launched its state owned Nigerian National Petroleum Corporation (NNPC) as commercial venture will hope that it oil sector will be finally revolutionized.

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