Finance Minister Ken Ofori-Atta hailed the debt restructuring deal as a pivotal moment for Ghana's economy.

Speaking on PM EXPRESS BUSINESS EDITION with George Wiafe, he emphasized its significance in expediting the reduction of the country's debt to sustainable levels.

The interview will air on JOYNEWS this Thursday, January 18, 2024. Mr. Ofori-Atta acknowledged the challenging negotiations with official creditors but commended the Finance Ministry, government officials, and the cooperation of creditors for reaching this agreement.

He asserted that this accomplishment demonstrates the commitment of all partners to assist Ghana in restoring debt sustainability in alignment with the IMF’s program targets.

Background

On January 12, 2024, the Finance Ministry declared reaching an accord with the Official Creditors Committee on debt treatment within the G20 common Framework.

Following months of negotiations regarding the restructuring of Ghana's debts, the OCC members, after a conclusive round of meetings last week, unanimously settled on December 2022 as the deadline.

IMF Managing Director Kristalina Georgieva welcomed the debt treatment agreement in a statement.

According to her, “This agreement clears the path for IMF Executive Board consideration of the first review of Ghana’s three-year Extended Credit Facility Arrangement in the next few days”.

She added that “The Government of Ghana looks forward to further engaging with the Official Creditors to ensure prompt implementation of the agreed terms”.

Proposed terms reached with creditors for restructuring Ghana’s debt

The Finance Minister had kept details of the "term sheet" confidential. However, he didn't dismiss the possibility of December 2022 as the deadline for restructuring Ghana's debts.

Mr. Ofori-Atta also acknowledged that Ghana would initiate debt servicing after the four-year moratorium, with payments starting after five years. Interest rates on these debts are anticipated to range between 2-3%.

Additionally, Mr. Ofori-Atta mentioned ongoing discussions with official creditors to finalize the Memorandum of Understanding for the deal.

He noted that “the terms of the agreed debt treatment are expected to be formalised in an MoU between Ghana and the official creditors in the coming days”.

But will this affect the proposed date for the IMF Board meeting, the Finance Minister responded “No because the agreement reached with them is enough for the IMF Board to meet”.

“We are prepared for this Board meeting and hopeful that Ghana will pass this first review”, the Finance Minister added.

The minister further stated that bilateral agreements with each official creditor committee member will be used to execute the Memorandum of Understanding.