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Ghana reached an agreement with external creditors for debt restructuring that was key to its USD 3 billion credit line with the IMF, the government and the lender.
Facing its worst economic crisis in decades, Ghana agreed to a loan from the International Monetary Fund (IMF) to help shore up its public finances and better manage its heavy debt load. Ghana received its first USD 600 million tranche of the IMF loan in May last year. The external debt deal helps clear the way for approval of another USD 600 million payment.
Ghana suspended payments on the majority of its external debt, essentially defaulting due to challenges in addressing its substantial balance of payments deficit.The restructuring parameters encompass both bilateral and commercial debt, including Eurobonds.
IMF managing director Kristalina Georgieva welcomed Ghana reaching an agreement in principle with their official creditors on a debt treatment, consistent with the objectives of the IMF-supported program, which aims to restore macroeconomic stability and debt sustainability. The deal clears the path for IMF Executive Board consideration of the first review of Ghana’s three-year agreement in the next few days.
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The Ghanaian government expects approval from the IMF Board, which will also prompt the World Bank Board to review USD 300 million in development financing for the country.
