(Reuters) - The International Monetary Fund's board on Wednesday approved a third disbursement of $114.6 million under Ghana's three-year aid programme, urging the government to further tighten fiscal controls to curb rising public debt, the Fund said.
Ghana, a major exporter of cocoa, gold and oil, entered the $918 million financial assistance programme in April, with the aim of restoring economic stability and boosting job growth.
The West African nation was once one of the continent's strongest performers but slumping global commodity prices and a fiscal crisis which drove its debt-to-GDP ratio to more than 70 percent have put a brake on economic growth.
Wednesday's approval followed a successful second staff level review in November, although concerns remained about the country's financial management and rising inflation, the Fund said in a statement.
"..it is essential that the government sticks firmly to its policy of strict expenditure controls, by maintaining the wage bill within the budget limits, while controlling discretionary spending," an IMF statement said late Wednesday.
"It is also important to continue to adhere to the domestic arrears clearance plan and avoid incurring new domestic or external arrears," it added.
Ghana's annual consumer inflation has been consistently above the government's target in the past year, forcing the central bank to announce increases in its benchmark policy rate which stood at 26 percent in November, from 21 percent in February.
End-of-year inflation was 17.7 percent, compared with the 13.7 percent projected in a revised budget presented in July.
"To help bring inflation down towards its medium-term target, Bank of Ghana should stand ready to further tighten monetary policy if inflationary pressures do not recede as expected," the statement said.
Ghana is yet to fully resolve a three-year electricity crisis that has crippled industries and made the government unpopular ahead of general elections later this year.
Washington sources told Reuters earlier the board was concerned about the power crisis and called on the government to resolve it urgently.
Wednesday's approval brings total disbursements for Ghana to $343.7 million under the programme, which ends next year.
Nigeria approves World Bank loan
Nigeria's government has approved a $200 million loan from a World Bank agency to develop infrastructure in Lagos state, its commercial hub, the minister for works, power and housing said on Wednesday.
The loan was the second tranche of a total of $600 million lent by the International Development Association to the Nigeria government for Lagos state since 2010, Babatunde Fashola said.
Lagos, a mega-city of 21 million people in the state of the same name, is the commercial engine of Africa's biggest economy. Its gross domestic product accounts for about a third of Nigeria's overall GDP.
Fashola, who did not give details of any projects for which the loan would be used, said the money had been intended for distribution in three tranches each of $200 million to end in 2013 but had been delayed.
"It suffered delays as a result of partisan political differences in the last dispensation. After the first tranche was disbursed there was a freeze on the second tranche," he told reporters.
Fashola said the loan was to be repaid over 25 years at an interest rate of 2.5 percent.