The Government of Ghana is set commence talks with domestic bondholders as parts of efforts to restructure the country’s cedi debt.
According to a Bloomberg report, the move forms part of government’s plan to secure a US$3 billion loan facility from the International Monetary Fund under an economic support programme.
Although Ghana has for some time not been able to access the international capital markets due its increasing public debt stock, revenue generation constraints and among others, Bloomberg said the country’s Eurobonds have since extended its declines in trading.
Meanwhile, Ghana is targeting an amount of $3 billion from the IMF once an agreement is reached.
One of the key requirements for the loan facility will entail the restructuring of the country debt which has been soaring.
For instance, commercial banks and pension funds are among some of the country’s largest debt investors which are preparing to engage in talks on the imminent debt restructuring exercise.
If all goes to plan, the debt reform could result in an extension of maturities and cuts placed on principal and interest payment.
Ghana’s public debt stock at the end of March 2022 rose by some GH¢40.1 billion to GH¢391.9 billion, data from the Bank of Ghana’s May 2022 Summary of Economic and Financial Data has showed.
This, in terms of the country’s Gross Domestic Product (GDP), is estimated at 78 percent, which is slightly lower than the 80.1 percent earlier recorded in December 2021.
Source: Ghanaweb