Latest news with #OfficialCreditorCommittee
Business Insider
4 days ago
- Business
- Business Insider
Ghana approves $2.8bn debt relief deal with 25 nations to support IMF bailout
Ghana's Parliament has unanimously approved a $2.8 billion debt restructuring agreement with 25 creditor countries, including China, France, the United States, Germany, and the United Kingdom. Ghana's Parliament approved a $2.8 billion debt restructuring agreement involving 25 creditor nations. The agreement enables further disbursements under Ghana's $3 billion IMF bailout programme. The restructuring provides debt service relief with repayments deferred to 2039–2043. The move paves the way for continued disbursements under Ghana's $3 billion International Monetary Fund (IMF) bailout programme, aimed at addressing the country's most severe economic crisis in decades. The West African country, known globally as the world's second-largest cocoa producer, had defaulted on most of its external debt in December 2022. In January 2025, Ghana reached a Memorandum of Understanding (MoU) with the Official Creditor Committee, marking a significant milestone in its debt recovery path. Debt relief and extended repayments According to a parliamentary report seen by Reuters, the restructuring provides a debt service relief of $2.8 billion during the IMF-supported programme period (2023–2026). The agreement entails the rescheduling and capitalisation of debt service payments originally due between 20 December 2022 and 31 December 2026. These deferred payments will now be repaid between 2039 and 2043, effectively pushing repayments forward by over 15 years. The Official Creditor Committee has agreed on interest rates ranging from 1% to 3%, based on the original contractual terms—rates that are significantly lower than current market levels, offering Ghana's treasury meaningful fiscal space. Parliament backs deal as essential for economic stability The report noted: 'The Committee observed that the debt restructuring was essential to support the government's efforts in restoring and sustaining macroeconomic stability and ensuring long-term debt sustainability.' Lawmakers unanimously recommended the approval of the agreement, underlining the importance of international cooperation in Ghana's economic recovery process. IMF programme and next steps The IMF initially approved Ghana's three-year $3 billion loan package in May 2023, helping stabilise the country's currency, ease inflationary pressures, and improve investor confidence—contributing to a credit rating upgrade by Fitch Ratings.
Arabian Post
4 days ago
- Business
- Arabian Post
Ghana Parliament Greenlights $2.8 Billion Debt Relief Deal
Ghana's parliament has given approval to a $2.8 billion debt restructuring agreement with 25 creditor nations, including China, France, the United States, Germany and the United Kingdom. This authorisation is vital for unlocking further disbursements from a $3 billion IMF-backed bailout programme initiated in May 2023. Lawmakers, endorsing the restructuring unanimously, approved measures under a memorandum of understanding signed in January 2025 that reschedule debt payments falling due between 20 December 2022 and 31 December 2026. Repayment has been deferred until the 2039–2043 period, affording Ghana over 15 years of fiscal breathing space. Interest on the restructured debt will be set between 1% and 3%, significantly below prevailing market rates. This intervention, coordinated through the Official Creditor Committee, is poised to fortify Ghana's macroeconomic stability by easing immediate liquidity pressures and supporting long-term debt sustainability. ADVERTISEMENT Since defaulting on most of its external debt in December 2022, Ghana—Africa's second-largest cocoa producer—has worked to stabilise its economy amid high inflation, a depreciating currency and contractionary pressures. The IMF bailout has helped to arrest market downgrade momentum, including a ratings revision from Fitch. Finance Minister Cassiel Ato Forson described the deal as a turning point, enabling a reduction in debt-to-GDP to around 55% by 2026 and the debt-service-to-revenue ratio to fall below 18% by 2028. He noted the government plans to channel the fiscal space created into critical development sectors such as infrastructure, agriculture and energy. Despite official creditor backing, Ghana still faces negotiations with commercial creditors over approximately $2.7 billion in private loans. These discussions, guided by the 'comparability of treatment' principle and the most-favoured-creditor clause, aim to prevent preferential terms and ensure cohesion between official and commercial agreements. Analysts caution that failure to finalise terms with private lenders could delay full debt relief and weigh on investor confidence, even as official support strengthens. This parliamentary action is expected to unlock the next IMF tranche under the three-year programme, which will in turn support Ghana's ongoing fiscal consolidation and monetary stabilisation efforts. Reaction from the business community has been cautiously optimistic. Observers note that by deferring large debt repayments until the late 2030s and capping interest rates, Ghana can prioritise capital investments and social spending in the short to medium term. However, success will be contingent on continued IMF compliance, central bank tightening to curb inflation, and the outcome of upcoming commercial creditor talks. As Ghana progresses towards formalising these bilateral agreements, experts suggest that solidifying its economic reform agenda will be essential. Any reversal or lack of follow-through risks undermining the country's debt trajectory ahead of contested elections scheduled for 2026.
Reuters
29-05-2025
- Business
- Reuters
Ghana asks Afreximbank to discuss debt treatment
ACCRA, May 29 (Reuters) - Ghana asked Afreximbank to sit down for debt treatment talks with the gold producing nation and its advisors in a letter sent last week by the finance minister and seen on Thursday by Reuters. "The objective of these discussions is to identify debt treatment solutions that are acceptable to Afreximbank, while ensuring that Ghana complies with the debt sustainability parameters of the IMF programme and the Comparability of Treatment principle as assessed by the (Official Creditor Committee)," Finance Minister Cassiel Ato Forson wrote in the letter dated May 21.
Reuters
29-01-2025
- Business
- Reuters
Ghana signs official creditor memorandum, formalising debt restructuring
ACCRA, Jan 29 (Reuters) - Ghana has signed a memorandum of understanding with its official creditors that formalises a debt restructuring agreed last year, its finance ministry said on Wednesday. The signing of the document is the latest milestone in the West African gold and cocoa producer's long-running debt restructuring saga, after it defaulted on most of its external borrowing in December 2022. Ghana and its Official Creditor Committee reached an agreement in June last year. All participating creditor countries have now signed the deal, the finance ministry's statement said, adding that it provided significant debt-service relief over its International Monetary Fund loan programme. Ghana is still speaking to its commercial external creditors to finalise restructuring agreements with them, the statement also said.
Zawya
29-01-2025
- Business
- Zawya
Ghana signs official creditor memorandum, formalising debt restructuring
Ghana has signed a memorandum of understanding with its official creditors that formalises a debt restructuring agreed last year, its finance ministry said on Wednesday. The signing of the document is the latest milestone in the West African gold and cocoa producer's long-running debt restructuring saga, after it defaulted on most of its external borrowing in December 2022. Ghana and its Official Creditor Committee reached an agreement in June last year. All participating creditor countries have now signed the deal, the finance ministry's statement said, adding that it provided significant debt-service relief over its International Monetary Fund loan programme. Ghana is still speaking to its commercial external creditors to finalise restructuring agreements with them, the statement also said. (Reporting by Christian Akorlie; Writing by Anait Miridzhanian; Editing by Alexander Winning and Frances Kerry)
