(Bloomberg) — Cash-strapped Ghana could jeopardize $3.8 billion of World Bank funding if an anti-LGBTQ bill passed last week is signed into law, according to a Finance Ministry document seen by Bloomberg.
The legislation, which seeks up to three years in jail for people who identify as LGBTQ, received bipartisan backing from lawmakers on Feb. 28. But it still needs the assent of President Nana Akufo-Addo to become law.
The nation was granted a $3 billion bailout from the International Monetary Fund after defaulting on its debt, which it is in the process of restructuring. The IMF program comes with separate World Bank financing to support the debt-distressed economy’s recovery.
“Ghana is likely to lose $3.8 billion in World Bank financing over the next five to six years,” according to the Ministry of Finance policy brief, which was drafted following an emergency session of the ministry after the bill was passed. “For 2024, Ghana will lose $600 million budget support and $250 million for the Financial Stability Fund.”
A ministry spokesperson declined to comment. The World Bank said it was not able to comment at this time.
‘Negatively Impact’
“This will negatively impact on Ghana’s foreign exchange reserves and exchange rate stability,” the finance ministry document said. A derailed IMF program will also “have dire consequences on the debt restructuring exercise and Ghana’s long-term debt sustainability.”
Ghana’s financial position depends critically on support from the two concessional lenders. The World Bank halted new funding to Uganda after it approved antigay legislation last year.
The IMF said last week it was monitoring the progress of the legislation closely. It also noted that its internal policies “prohibit discrimination based on personal characteristics, including but not limited to gender, gender expression, or sexual orientation.”
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