$110m Grant To Fight Poverty

from Modern Ghana

The World Bank yesterday granted Ghana its Fifth Poverty Reduction Support Credit (PRSC-5), with a total amount of $110 million (¢1012 billion) to support the nation’s poverty reduction strategy.

When the new currency is introduced in July, the money would be converted into G¢ 101 million.

The credit has been designed to help finance the programmes and projects outlined in the 2007 budget, including the cost of emergency power supply.

The proceeds of the credit would be used to finance the 2007 budget in two ways. Firstly, the Bank of Ghana on behalf of the government would use the foreign exchange to finance foreign expenditures and also shore up the country’s foreign exchange reserves.

Secondly, the central bank shall credit the Consolidated Fund with the cedi equivalent of the facility of about G¢ 101million, which shall then be used to finance the local expenditures arising out of the 2007 budget.

Under an agreement signed in Accra by the Deputy Minister of Finance and Economic Planning, Dr Akoto Osei, and the World Bank Country Director, Mats Karlsson, the money would be poured into a poverty reduction support credit projects, with the aim of improving the living conditions of Ghanaians.

The facility is highly concessional with standard IDA terms. Repayment period is 30 years with grace period of 10 years.

A commitment fee of one and half per cent per annum may be waived at the discretion of IDA executive board of directors.

Mr Karlsson said the World Bank is solidly behind Ghana, adding that the country’s economy is moving in the right direction.

“We need to do a little more by using our resources in the proper manner,” he advised.

Dr Akoto thanked the bank for its continuous support for Ghana pledging that the fund would be put to good use to further grow the economy and reduce poverty.

By Felix Dela Klutse