Over the coming days Ghana will be subject to the first of its semi-annual Test Reviews by the International Monetary Fund under its Policy Coordination Instrument (PCI) arrangement with the Fund. The first review will take place imminently since it is slated to assess Ghana’s performance under the programme up to September 30, 2026.
Ghana’s 36-month, non-financing PCI arrangement with the IMF formally began on July 27, 2026. It was approved by the IMF Executive Board concurrently with the completion of the sixth and final review of Ghana’s US$3 billion financial bailout under the Extended Credit Facility (ECF).
Because the PCI is a non-financing program, its purpose is to serve as a policy anchor to sustain macroeconomic stability and signal structural reform commitments to private investors and international donors without providing new credit.
An official IMF Mission Team, composed of economists and financial experts led by the IMF Mission Chief for Ghana, will conduct the fieldwork and evaluations. They will collaborate directly with officials from Ghana’s Ministry of Finance and the Bank of Ghana.
The review will rely on quantitative tracking and macro-critical reform targets. The mission team will meet with stakeholders, verify the central bank and treasury ledgers, and draft a staff-level assessment. The in-country and technical assessment will take roughly two weeks in October. Once a staff-level agreement is reached, it will be sent forward to the IMF Executive Board, which is expected to formally conclude the review by January 2027.
As the PCI arrangement is fresh, the foundational actions have focused on transition policies, establishing the new fiscal baseline, and preparing for ongoing verification of several key policy thrusts.
The first is the calibration of the 2026 Fiscal Framework. The government has targeted a primary fiscal surplus of 1.5% of GDP for 2026. Under the policy flexibility mapped out by the PCI, this target functions alongside a calibrated fiscal space designed to safely ramp up social spending while keeping Ghana on track to hit its 45% debt-to-GDP anchor by 2034.
The second is policy rate adjustments and monetary policy alignment. The Bank of Ghana has aligned its monetary policy frameworks to protect the Cedi and support disinflation. This includes addressing temporary deviations stemming from the Domestic Gold Purchase Program (DGPP), which had briefly expanded the central bank’s claims on the government, generating considerable controversy in Ghana.
The third is State-Owned Enterprise (SOE) accountability measures. Efforts have been initiated to strengthen structural oversight, transparency, and financial management for struggling state institutions, particularly within the energy sector and Ghana Cocoa Board (COCOBOD).
What the review will address
Unlike a traditional bailout review, the upcoming non-financing test will focus strictly on policy discipline, signaling, and accountability to preserve economic stability without any money being disbursed. As the core of this, the effort at achieving growth-friendly fiscal consolidation will be assessed to verify that expenditure remains restrained.
A Monetary Policy Consultation Clause (MPCC) will also be assessed to ensure that inflation and money supply tracking align closely with central bank goals. The MPCC functions as an active accountability framework rather than a rigid target. It sets layered, concentric inflation bands around the Bank of Ghana’s central target. If inflation drops below or spikes above these designated boundaries, it triggers mandatory consultations with the IMF. The primary medium-term inflation target is established at 8%, with a standard symmetric inner band of ±2%. This forms operational parameters whereby 10% is the absolute ceiling and crossing this point requires an automatic and immediate formal consultation with the IMF Executive Board. The central target benchmark is 8.0% and an inflation level above this but below the 10% ceiling is the warning threshold for upside risk.
The implementation of central bank safeguards are also to be examined. This will involve assessing the implementation of a comprehensive recapitalization plan for the Bank of Ghana and safeguarding its absolute operational independence, as well as checking progress on shifting the operational aspects of the Domestic Gold Purchase Program (DGPP) from the central bank over to the Gold Board to eliminate unintended state financing loops.
The effort to enhance transparency and good governance in state owned enterprises will also be assessed with specific regards to monitoring strict oversight, financial controls, and risk management frameworks for underperforming entities, notably COCOBOD and state energy firms. Added to this will be a review of the implementation of the enacted code of conduct laws for public officials.
Ghana’s score card so far
According to initial updates provided by the government and observations from the Bank of Ghana, the country is positioned very well to pass the first test review. Real GDP growth accelerated to a robust 6.2% for the first half of 2026, while inflation remains in single digits (5.0% as of August 2026), satisfying the baseline trajectory for the MPCC.
The government has also reported that it has exceeded its initial targets for the first half of the year. The primary balance is on track to record the mandated 1.5% GDP surplus. Gross International Reserves (GIR) climbed substantially, maintaining over 3 months of import cover (4.2 months as at the second half of September) to support currency stability. Minor administrative deviations under the previous ECF—such as temporary central bank cost-sharing under the gold purchase program—have been corrected and integrated into the new framework, giving the central bank strong backing ahead of the October evaluation.
The IMF will be particularly pleased by Ghana’s efforts at restoring and retaining public debt sustainability. The explicit, legislated long-term objective under Ghana’s fiscal responsibility framework and the IMF programme is to achieve and maintain a public debt anchor of 45.0% of GDP by 2034.
A comparison of the projected path against actual performance demonstrates that Ghana has dramatically outperformed the IMF’s original timeline, achieving its long-term anchor nearly nine years ahead of schedule. By the end of the first half of 2026 total public debt as a proportion of GDP was down to 45.0%, which is where the IMF mandated Ghana to be by 2034.The Fund’s ECF programme baseline, set in 2024, was 61.8%, down from the high of 73.1% reached at the peak of Ghana’s economic crisis in 2022. At that time Ghana was rated as being a highly debt-distressed country but the country has since been upgraded to being of moderate risk with the IMF setting a target of achieving sustainable debt (low to moderate risk) by 2034.
The sharp contraction in Ghana’s debt to GDP ratio from 61.8% at the end of 2024 to 45.0% currently was driven by the aggressive finalization of domestic debt swaps and the restructuring of US$13 billion in Eurobonds completed in late 2024 plus the rapid appreciation and stability of the Ghanaian Cedi during since mid-2025, paired with real GDP growth averaging over 6%, which has expanded the nominal GDP denominator, compressing the ratio further.
Because Ghana hit the 45% target prematurely, the IMF agreed under the PCI framework to allow the government to scale down its strict primary fiscal surplus target from 1.5% of GDP in 2026 down to 0.5% of GDP starting in 2027. This adjustment unfreezes roughly GH¢18 billion in liquidity, allowing the state to pivot from debt reduction toward critical domestic infrastructure and social spending.
The cost of failure
All this means that Ghana is most likely to comfortably pass the first semi-annual PCI review which it is about to embark on. But being a non-financing surveillance framework, the immediate penalty for missing economic performance targets is not the withholding of loan disbursements anyway. Instead, the IMF’s structured rules for non-compliance focus on timeline delays, market signaling degradation, and automatic programme termination.
If a target is missed, the IMF will not immediately fail the country. The program permits a three-month delay to allow the Ghanaian authorities to design and implement corrective actions, adjust policy rates, or re-calibrate the budget. The PCI uses a review-based approach to monitoring. This means that government does not need to request formal waivers for missed targets from the IMF Executive Board, provided it fixes the slippage or adjusts policies within this three-month window.
If the three-month buffer period expires and the targets are still not met, the first review cannot be completed. Instead, IMF staff will bypass the completion phase and issue an Interim Performance Update directly to the IMF’s Executive Board. This report becomes public, officially signaling to the global community that Ghana’s economic program has veered off track.
The ultimate structural penalty for persistent failure is program cancellation. If Ghana is unable to complete a scheduled review for a continuous 12-month period, the entire 36-month PCI arrangement is automatically terminated.
While no IMF cash is directly cut off, a failed review triggers immediate real-world penalties across the broader economy.
The primary purpose of the PCI is to give a “seal of approval” to international markets. A missed review tells rating agencies like S&P, Fitch and international bondholders that fiscal discipline is slipping, risking immediate negative rating actions – translate as downgrades.
Besides this, many external development partners (such as the World Bank, African Development Bank, and bilateral donors) tie their direct budgetary support and grant disbursements to Ghana maintaining an active, “on-track” IMF programme.
An active, on-track PCI acts as a fast-track mechanism to access IMF financial resources (like the Stand-By Arrangement or emergency financing) as well, if Ghana experiences a sudden external shock. Failing the review closes this rapid-access window.
By: Toma Imirhe / businesspostonline
