In a pivotal meeting set for Monday, Ghana’s official creditors, including key players from China and France, will convene to deliberate on the restructuring of approximately $5.4 billion in loans. This crucial gathering is a necessary step towards securing the next installment of funding from the International Monetary Fund (IMF), as confirmed by three informed sources.
The bilateral lenders, who collectively hold about a quarter of Ghana’s $20 billion external debt targeted for restructuring, are expected to tackle the contentious issue of a “cut-off date.” This date determines the point beyond which new loans from bilateral creditors will not be subject to restructuring. The selection of this date has proven to be a significant hurdle for Ghana in its efforts to rework its debt.
Some creditors have shown a preference for December 31, 2022, as the cut-off date, aligning with Ghana’s default earlier that month. However, others have advocated for March 24, 2020, marking the launch of the Group of 20’s debt service suspension initiative (DSSI) aimed at assisting the world’s poorest nations amidst the COVID-19 crisis. Notably, Ghana did not participate in the DSSI.
The outcome of this meeting is anticipated to have far-reaching implications for Ghana’s economy, which has been grappling with challenges exacerbated by global economic pressures. The nation’s quest for financial stability has been a focal point of international attention, with various news outlets and government websites providing extensive coverage and data on the matter.
As the world watches, the decisions made by Ghana’s creditors could set a precedent for other nations facing similar economic predicaments. The hope is that a favorable resolution will pave the way for Ghana’s economic revival, offering a beacon of light in these trying times.
Source: Reuters
