Written by Elena Popina | From Bloomberg

President John Mahama said a fiscal injection from the International Monetary Fund will be useful to bolster the economy, giving the first indication the government may seek a loan from the lender. Speaking in an interview in New York yesterday, Mahama, said he expects to sign a three-year program with the Washington-based lender.

An IMF team arrived in Ghana last week to begin talks on possible aid, though no detail has been disclosed if that will entail loans or technical support.

“When implementing a program it helps to get a fiscal injection,” Mahama said. “One of the major features of our economic difficulty has been a reduction in our external reserves. In a situation like that, some fiscal injection from the IMF to stabilize the central bank and stabilize the reserve situation is useful.”

Ghana’s budget deficit has spiraled since 2012 as the government failed to curb election-related spending and a rising wage bill, while revenue fell. That’s prompted credit-rating companies to downgrade the nation’s debt and caused the cedi to lose a third of its value against the dollar this year, making it the worst-performing currency in sub-Saharan Africa.

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