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HomeBusinessGhana will reengage international bondholders next week, says Finance Minister

Ghana will reengage international bondholders next week, says Finance Minister

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Ghana will reengage with its international bondholders from next week, finance minister Ken Ofori-Atta told Reuters on Monday, as the country seeks to build on the momentum of a deal last week to restructure $5.4 billion of official creditor debt.

The West African country will seek to continue discussions after meeting holders of its around $13 billion in outstanding Eurobonds in Marrakech in October, Ofori-Atta said in an interview on the sidelines of the World Economic Forum (WEF) annual meeting.

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Officials will also travel to China on Jan. 23, he added. China and France co-chair Ghana’s Official Creditor Committee and the agreement reached with the committee was key to unlocking more funding from a $3 billion International Monetary Fund (IMF) rescue loan.

Ghana defaulted on most of its overseas debt in December 2022 after debt servicing costs soared. It is looking to restructure $20 billion of external debt, which totaled about $30 billion at the end of 2022, and has already restructured most local debt.

Restructuring negotiations last year were a “very difficult, painful process,” but Ghana has “built pretty good momentum”, Ofori-Atta said.

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The IMF board is due to meet on Friday to decide on a $600 million disbursement from Ghana’s bailout program. Getting approval is usually seen as a formality once a meeting has been scheduled and would unlock funding from other multilateral lenders.

The World Bank was expected to decide on $550 million of “sorely needed” funding on Jan. 25, Ofori-Atta added.

Ghana is reworking its debts under the Common Framework, a restructuring process set up by the G20 countries during the COVID-19 pandemic that has been criticized for slow results.

Ofori-Atta said the 2022 macroeconomic situation had been “cage rattling”, but was improving, and he pointed to a rise in revenue and a decline in inflation.

The latest data showed consumer inflation had slowed to 23.2% year-on-year in December compared to the more than 50% when the country tipped into default.

Meanwhile growth was running at 3%, more than twice the IMF’s projected rate of 1.2%, Ofori-Atta said.

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