Ghana has tentatively agreed with its bondholders to restructure $13 billion of international debt, following a recent deal with official creditors, sources told Reuters on Thursday.
The agreement includes a principal haircut of up to 37% and an extension of bond maturities, according to two of the sources.
The West African nation, a major gold and cocoa producer, defaulted on most of its $30 billion external debt in 2022, impacted by the COVID-19 pandemic, the war in Ukraine, and rising global interest rates. Ghana, like Zambia, sought debt relief through the G20 Common Framework, aiming for swift debt restructuring involving major bilateral lender China.
Following Zambia’s successful debt restructuring deal earlier this month, Ghana is reportedly close to an official announcement, expected by next week, according to one source. Two other sources indicated the announcement could come as early as Friday. Ghana’s finance ministry and the Paris Club were unavailable for comment due to the late hour.
Ghana began formal negotiations with two groups of bondholders in mid-March: Western asset managers and hedge funds, and a group including regional African banks. However, talks stalled in April after the initial proposal failed to meet the International Monetary Fund’s (IMF) debt sustainability criteria, prompting further discussions.
The sources indicated that the revised agreement now aligns with the IMF’s updated debt framework for Ghana, leading to the tentative deal. Earlier this month, Ghana reached an agreement with its official creditor committee to formalize a debt restructuring deal from January.
This agreement allows the IMF executive board to meet on June 28 to review Ghana’s $3 billion, three-year loan package and potentially release the next $360 million tranche.
