Parliament on Friday evening approved a US$1 billion credit facility to mitigate the impact of the COVID-19 pandemic.

The facility, titled “Rapid Credit Facility (RCF) Agreement” which is between the Government of Ghana, represented by the Ministry of Finance, and the International Monetary Fund (IMF) amounts to 738 million Special Drawing Rights.

The approval follows a request from the Government of Ghana after the IMF had announced on 4th March 2020 a US50 billion support to help address the Coronavirus impact with an allocation of US$ 10 billion for low-income countries through the RCF window.

Dr Mark Assibey-Yeboah, Chairman of the Finance Committee, presented the report of the Committee to the plenary, said the facility is 100 percent of Ghana’s quota and the disbarment of the facility proceeds to Ghana was expected to take place in a single tranche on Friday, 17th April 2020.

The purpose of the facility is to provide low access, rapid and concessional financial assistance to Low-Income Countries facing an urgent balance of payments needs, without ex-post conditionality.

In Ghana’s case, the RCF has been negotiated to be used for Budget Support.

According to the report, Ghana originally requested 50 percent of Ghana’s quota, but the Minister of Finance successfully engaged the IMF to increase the request to 100 percent of Ghana’s quota.

The terms and conditions of the loan are that it has a grace period of 5 and a half years, a repayment period of 4 and a half years, a maturity period of 10 years, with no interest charge.

Dr Assibey-Yeboah announced that an approximate GHC1billion of the fund would be used to finance the electricity subsidy announced by President Nana Addo Dankwa Akufo-Addo, whilst the remainder would be employed towards expenditure outlined in the 2020 Budget.

As of 18th April 2020, Ghana had recorded 834 confirmed COVID-19 positive cases, nine deaths and 99 recoveries.