Ratings agency Fitch has forecasted that Ghana will exit sovereign default by July 2025, following the anticipated completion of its external debt restructuring by June 2025.
Fitch is optimistic that Ghana will finalize the treatment of its non-bond debt by the end of 2024. The UK-based agency revealed this projection during a recent webinar on debt restructuring in Ghana, Zambia, and Ethiopia.
Thomas Garreau, Associate Director of Europe, Middle East, and Africa Sovereign Ratings at Fitch, explained, “For Ghana, we expect the completion of the common framework restructuring by the first half of next year. However, upcoming elections may delay the process, which is why we forecast completion in mid-2025.”
Ghana reached an agreement with the Official Creditor Committee (OCC) in January 2024 regarding the parameters of official debt treatment. Additionally, the country restructured approximately $14.2 billion of Eurobonds, including Participatory Debt Instruments (PDIs), through an exchange in October 2024.
The restructuring has led to a haircut equivalent to 6.2% of Ghana’s Gross Domestic Product (GDP). Furthermore, the burden of interest payments has been significantly reduced, amounting to 8% of Fitch’s projected revenue for 2024, 5% for 2025, and 4% for 2026.
Fitch’s projections reflect confidence in Ghana’s ongoing efforts to stabilize its economy and address debt sustainability challenges.
