The restructuring of Ghana’s debt is currently at the center of concerns, with a meeting of public creditors scheduled for Monday, January 8. This meeting aims to discuss the possibilities of restructuring the 5.4 billion dollars of credits that Ghana has contracted. A crucial step for the country which hopes to receive a second tranche of financial aid promised by the International Monetary Fund.
Public creditors, some of whom are in favor of a restructuring of debt contracted before December 31, 2022, and others prefer March 24, 2020, the start date of the G20 debt service suspension initiative, will have to find a compromise regarding the deadline.
However, it is important to note that Ghana’s debt is much larger than the portion subject to this restructuring. Indeed, Ghana has more than $20 billion in external debt, particularly to bilateral creditors and private actors.
The negotiation with the latter promises to be more complex, as BNP Paribas highlighted in a report last October. It is therefore crucial for Ghana to reach an agreement with official creditors to release the funds promised by the IMF and find a viable solution for the management of its long-term debt.
This restructuring is all the more important as Ghana did not benefit from the G20 debt suspension mechanism, designed to help the poorest countries cope with the global health crisis.
In conclusion, the meeting of Ghana’s public creditors marks a crucial step in the country’s debt restructuring process. The results of this meeting will be decisive for obtaining the funds promised by the IMF and for the management of Ghana’s debt in the future.