Ghana secures agreement to restructure $13.1 Billion Eurobond debt

Ghana has successfully reached an agreement with Eurobond holders to restructure $13.1 billion of its commercial debts.

This agreement, which involves a 37% haircut for Eurobond holders and delayed repayments, marks the final step in the nation's external debt restructuring process.

The Committee of Holders of Ghana’s Eurobonds announced this deal, highlighting that it would significantly alleviate

Read full articlecash flow and debt stock burdens, aiding Ghana's economic recovery under the International Monetary Fund (IMF)-backed Extended Credit Facility program.

The Committee emphasized the importance of sustained economic policy implementation to ensure fiscal and debt sustainability.

They welcomed the government's commitment to reinstate and implement an amended Fiscal Responsibility Act, which includes provisions such as semi-annual disclosure of public debt and clauses to maintain credibility with bondholder investors. These measures aim to restore Ghana’s access to international markets.

Minister of Finance, Dr. Mohammed Amin Adam, praised the agreement as a major step towards reducing the country's debt to sustainable levels.

He mentioned that the concessions made by Eurobond holders, which include $4.4 billion in cash flow relief and the cancellation of $4.7 billion of debt stock, would significantly aid Ghana’s path to debt sustainability.

"This is a significant concession that will allow us to efficiently navigate our path towards debt sustainability, even while continuing to ensure fiscal prudence and efficient revenue mobilisation," Dr. Amin Adam stated.

Expert opinions, like that of Professor Peter Quartey, Director of the Institute of Statistical, Social and Economic Research (ISSER), indicate that this agreement will bring much-needed certainty to the financial market. He suggested that the government set aside part of the savings from this restructuring in a sinking fund to prepare for future repayments.

Prof. Quartey also stressed the need for fiscal prudence to avoid repeating past financial challenges and called for a cap on borrowing.