The government of Ghana has reached an agreement in principle with the Committee of holders of its Eurobonds on a restructuring of its debt in a step towards the country’s economic recovery.
The agreement is expected to offer significant cash flow and debt stock relief to help Ghana’s economic recovery in line with the International Monetary Fund-financed programme.
The Committee, representing the bondholders, reaffirmed its support for Ghana’s dedication to sustainable economic policies, which are intended to strengthen macroeconomic stability, enhance investor confidence, and institutionalize fiscal credibility.
The deal includes provisions for semi-annual disclosure of public debt, a most-favoured-creditor clause, and a loss reinstatement clause, which are designed to normalise relations with bondholder investors and restore Ghana’s access to international markets.
The Committee, in a statement on Monday, June 24 has advised all investors of Eurobonds to carefully review the terms of Ghana’s potential offer and independently evaluate the benefits and risks of participating.
“The proposed agreement on the restructuring of the Eurobonds will resolve Ghana’s default on the Eurobonds in a manner that provides significant cash flow and debt stock relief to support Ghana’s economic recovery in the context of the IMF-financed program.
“Alongside debt relief, the Committee recognizes that the most important factor to support Ghana’s fiscal and debt sustainability going forward is sustained economic policy implementation to bolster macroeconomic stability, improve the investor environment and to institutionalize fiscal credibility. In particular, the Committee welcomes the Government’s commitment to reinstate and implement an amended Fiscal Responsibility Act.
“The non-financial provisions included in the agreement-in-principle, such as the semi-annual disclosure of public debt, the most-favoured-creditor clause and the loss reinstatement clause, are part of the package of measures to normalize relations with bondholder investors and to progress towards restoring Ghana’s international market access.
