Ghana poised for $9.1 billion debt relief under IMF program …sets sights on 55% debt-to-GDP ratio by 2028
Ghana is set to save $4.4 billion in debt service payments and benefit from a $4.7 billion debt cancellation as part of its ongoing program with the International Monetary Fund (IMF).
These measures aim to reduce the country’s debt-to-GDP ratio to 55% by 2028, according to the Minister of Finance, Dr. Mohammed Amin Adam.
In the coming days, Ghana will officially launch its exchange offer, a crucial step in the nation’s external debt restructuring process. The West African country has been working to restructure its $30 billion debt to recover from the worst economic crisis it has faced in decades.
The exchange offer is based on terms agreed upon with bondholders on June 24th, which include significant concessions, ensuring a fair distribution of the burden among domestic, official, and commercial external creditors.
At a recent economic briefing, Dr. Adam announced, “We are pleased to officially launch our exchange offer, marking a critical step in our external debt restructuring journey. The exchange will be open for 21 days, and we rely on the full support of our bondholder community, both internationally and domestically, to achieve high participation levels.”
The government expects all outstanding bonds to be exchanged for new ones, offering investors two options: a “PAR” option with no nominal haircut but lower interest rates, and a “Disco” option with a 37% nominal haircut but higher interest rates.
Dr. Adam expressed gratitude to the bondholder community, stating, “We thank the bondholder community for their support and hope that a successful exchange will pave the way for a normalization of our relationship with international markets.”
He also emphasized the government’s commitment to completing strategic infrastructure projects impacted by the debt restructuring. Notable achievements include the completion of the Prempeh I International Airport, the Afari Military Hospital in Kumasi, and the Yakubu Tali International Airport in Tamale.
This week, President Akufo-Addo inaugurated the Accra-Tema Motorway redevelopment project. Additionally, Dr. Adam recently inspected progress on the Kasoa-Winneba Road, a critical project fully funded by the national budget. “Like many of you who travel that road, I am very impressed with the progress of work,” he remarked.
The government is also working with its partners to implement the Economic Roads Improvement Programme, which includes the Accra-Kumasi Road, as part of a broader strategy to boost trade, tourism, and regional integration.
By Eugene Davis
