Ken Ofori-Atta

Government to use IMF loan to pay for Covid-19 electricity subsidy

Chairman of Parliament’s Finance Committee Dr Mark Assibey Yeboah has disclosed part of a US$ 1 billion loan government has secured from the IMF will be used to pay for the Covid-19 electricity subsidy for Ghanaians announced by President Akufo-Addo.

Parliament on Friday night approved the US$1 billion (5.5 billion Ghana cedis) International Monetary Fund (IMF) Rapid Credit Facility (RCF) to mitigate the impact of the Covid – 19 pandemic.

Dr. Assibey Yeboah who delivered to the house a report of the Finance Committee of Parliament recommending approval of the loan, said 1 billion Ghana Cedis of the amount will be used to pay for the electricity subsidy.

President Akufo-Addo on 9th April 2020 announced the free electricity and subsidy for some electricity consumers. Energy Minister Peter Amewu told a media briefing on Friday the support will cost 1 billion Ghana cedis.

“Out of the total facility, approximately 1 billion Ghana Cedis will be used to finance electricity subsidy announced by the president whilst the remained is employed towards expenditure outlined in the 2020 budget.

In a memo to parliament, the Minister for Finance Ken Ofori Atta said the loan is part of an amount of US$50 billion the IMF is offering to help address Coronavirus impact on low income countries.

Ghana had originally sought to apply for an amount of US$500 to US$600 million, but successfully engaged the fund to increase the request to US$1 billion.