Ghana will cap its 2014 Eurobond at $1 billion rather than the $1.5 billion initially approved by parliament in order to sustain its debt levels, President John Mahama told Reuters in an interview on Friday.
The West African country may look for fresh financing if it can secure an assistance deal with the International Monetary Fund, Mahama said, adding that former finance minister Kwesi Botchwey would lead talks due to start on Sept. 16.
Ghana announced in August it would seek an IMF programme to tackle fiscal problems including rising inflation, a stubborn budget deficit and a currency that has tumbled this year. These factors threaten an economy that has grown rapidly on the back of exports of gold, oil and cocoa.
“This is the time to not only stabilize the macro but also to implement the measures that will transform this economy and make it more robust and resistant and resilient to the kinds of shocks that a country like Ghana faces,” Mahama said.
Fiscal stability and reforms must be sustained beyond the 2016 election cycle for the economic programme to succeed, he said. Ghana’s deficit rose sharply in 2012, the year of the previous election, mainly due to public sector wage rises.
Mahama said Ghana was hoping to bring inflation, which hit 15.3 percent in July, down to 11-12 percent by the end of the year.