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HomeBusinessGhana, Zambia to emerge from foreign-currency debt default in 2024 – Fitch

Ghana, Zambia to emerge from foreign-currency debt default in 2024 – Fitch

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Rating agency, Fitch, expects Ghana and Zambia to emerge from default on their foreign-currency debt in 2024.

In its Regional Sub-Saharan African Sovereigns Outlook 2024, it stated that the two countries will come good in terms of restructuring their debts.

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“We forecast gradual fiscal consolidation due to financing constraints and fiscal reform efforts, which, in many cases, are linked to IMF [International Monetary Fund] programmes. This consolidation will help government debt/GDP to broadly stabilise”.

“We expect Ghana and Zambia to emerge from default on their foreign-currency debt in 2024, although, in both cases, the debt restructuring process under the Common Framework is vulnerable to further delays”, it added.

The UK-based firm continued that the macro outlook for sub-Saharan Africa in 2024 including Ghana points to stable median real Gross Domestic Product growth and lower average inflation, which nonetheless remains high across a number of sovereigns.

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“The macro outlook for sub-Saharan Africa (SSA) in 2024 points to stable median real GDP growth and lower average inflation, which nonetheless remains high across a number of sovereigns”. 

Fitch, however, expects financing challenges to persist as most Sub-Saharan African sovereigns do not have affordable access to international capital markets without credit enhancements.

It stated that multilateral funding will remain a key support more broadly across the region. However, risks remain tilted to the downside.

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