Jump to navigation

Ghana

Agreement likely on $5.4 billion debt restructure this week

Finance minister claims terms offered by creditors will help unlock next tranche of credits from IMF

As critical talks between ministers and official creditors (including the Paris Club and Chinese lenders) on restructuring  US$5.4 billion of Ghana's external debt continue this week, a senior IMF official said on 9 January that the fund was optimistic about an agreement which would unlock the next $600 million of financial support as part of the country's $3bn extended fund facility programme.

A deal with official creditors could also unlock $550m of funding from the World Bank. Credits from the IMF and the Bank are conditional on the terms of the debt restructuring and Ghana's ability to meet financial targets.

On 11 January, Ghana's finance minister Ken Ofori-Atta told journalists in Accra that the government was reviewing a draft term sheet from the creditors whose scope was sufficient to meet the IMF's concerns about state finances.

Bloomberg News reported that Ghana's US dollar bonds had gained by 1.3%-1.4% on the finance minister's statement.

Ofori-Atta led the government team in meetings that began on 8 January with the Official Creditor Committee (OCC), co-chaired by the governments of China and France, which holds around 25% of Ghana's $20bn external debt earmarked for restructuring.

Officials have indicated that the talks will also focus on brokering an agreement on a 'cut-off date,' after which new loans from bilateral creditors will not face restructuring. Release of the next tranche of funding from the IMF is contingent on a restructuring deal.

President Nana Addo Dankwa Akufo-Addo's government wants to conclude the debt restructuring and IMF deal early this year. That would give it enough time to engineer some kind of economic feel-good factor ahead of December's general election (AC Vol 65 No 1, The economy will tilt the election).

Vice-President Mahamudu Bawumia is the ruling New Patriotic Party's presidential candidate and is due to launch his campaign later this month in what is shaping up to be a close contest with the opposition's New Democratic Congress (NDC) candidate, former President John Mahama.



Related Articles

Supreme Court outlaws presidential decisions

President Akufo-Addo's sacking of the Auditor-General has been condemned raising questions of accountability

Ghana's highest court has ruled unconstitutional President Nana Akufo-Addo's demand three years ago for the Auditor-General, Daniel Domelevo, to go on leave. After Domelevo complied under heavy pressure,...


    Vol 6 (AAC) No 3 |
  • GHANA

John Dramani Mahama

President, Ghana

Newly elected as President in December 2012, John Dramani Mahama will continue to deepen Ghana’s ties with its Asian trading partners. When former Vice-President Mahama served...


Rolling with the punches

Vice-President Arkaah's claim that President Rawlings beat him up helps the opposition

Whatever happened at the 28 December Cabinet meeting at State House, it is helping the opposition's campaign for this year's elections. According to President Jerry Rawlings' supporters, his...


Brief honeymoon

President Kufuor's new team will have to take some tough decisions on the economy

The rest of the world congratulated Ghanaians for two well-run rounds of voting and a credible transition from one elected government to another. The New Patriotic Party's victory...