Anti-LGBTQ bill could scupper $3.8bn financing

Ghana’s anti-LGBTQ bill could lead to a loss of $3.8bn in World Bank financing over the next five to six years if it becomes law, derailing a $3bn IMF loan package, the finance ministry said in a document seen by Reuters on Monday.

Legislators last week unanimously passed the legislation that will intensify a crackdown on the rights of LGBTQ people and those accused of promoting lesbian, gay or other minority sexual or gender identities.

The bill, one of the harshest in Africa, will now be presented to President Nana Akufo-Addo, who will decide whether to sign it into law.

The document, dated March, said it summarised deliberations between the finance minister, central bank governor, head of the tax authority and other senior officials and contained recommendations for the president.

The bill’s passage through parliament comes as the West African country tries to emerge from a deep economic crisis and debt default with the help of a $3bn IMF loan programme secured in 2023 and financing from the World Bank.

The US has said it is “deeply troubled” by the proposed legislation and urged a review of the “constitutionality of the bill”.

In the internal document seen by Reuters, the finance ministry said Ghana was likely to lose $3.8bn in World Bank financing over the next five to six years, negatively impacting foreign exchange reserves and exchange rate stability.

Losing World Bank funding would in turn “derail” the IMF programme, triggering a negative market reaction that would affect exchange rate stability, it added.

“A derailed IMF programme will have dire consequence on the debt restructuring exercise and Ghana’s long-term debt sustainability,” it said.

It also recommended “engagement with conservative countries, including the Arab countries and China”, to secure additional financing to fill any potential funding gaps.

The World Bank said it was preparing a response. The IMF did not immediately respond to an emailed request for comment.

It had said on Friday that it could not weigh in on the implications of a bill not yet signed into law, but noted that internal IMF policies prohibited discrimination based on personal characteristics.

The passage of a similar antiLGBTQ bill in Uganda led the World Bank to suspend new funding for the East African country.