Ghana aims to conclude debt restructuring before IMF loan assessment

• Ghana's Finance Minister, Ken Ofori-Atta, announces plans to complete debt restructuring before the next assessment of the country's $3 billion loan from the IMF. 
• The Ghanaian government is working towards obtaining a memorandum of understanding (MoU) with creditors to achieve a debt restructuring arrangement in the coming weeks. 
• Ghana aims to reduce interest payments on its external debt by approximately $10.5 billion over the next three years to fulfill its $3 billion loan agreement with the IMF.

Finance Minister Ken Ofori-Atta stated on Sunday that Ghana hopes to finish its debt restructuring before the next assessment of its $3 billion loan from the International Monetary Fund (IMF).

The finance minister stated that the country was working to obtain a memorandum of understanding (MoU) with the creditors and that it hoped to achieve an arrangement with them in the upcoming weeks. As the country struggles with its greatest economic crisis in a decade, he pointed out that the administration is in discussions with its creditors to restructure its debt.

To properly fulfill a $3 billion loan agreement from the IMF, Ghana must reduce interest payments on its external debt by almost $10.5 billion over the next three years.

According to a government presentation to investors, as of the end of 2022, its obligations to nations like China and members of the Paris Club of creditor nations totaled $5.4 billion of the $20 billion foreign debt that was due for restructuring. About $30 billion worth of foreign debt was present overall.

We've successfully worked with the Paris Club and other creditors to determine the parameters for official debt restructuring under the G20 common framework for debt treatment, the finance minister relayed to journalists who were present at the briefing, in Accra. In the coming weeks, we will seek to complete the MoU on terms with bilateral debt treatment, he added.

The finance minister also disclosed that Ghana will continue talks with private creditors and Eurobond investors on the country's foreign debt in order to quickly seek a resolution.

We expect to finalize these negotiations before the next review, which is in September, he said.

According to the minister, the government will pass an energy sector reform plan by the end of June, allowing it to address the debt due to independent power producers, which increased from $1.58 billion to $2 billion by May 2023.

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