The Ghanaian government is set to launch an external debt exchange offer in the coming days, a key move in the country’s debt restructuring efforts.
Finance Minister Dr. Mohammed Amin Adam announced this development at a press conference on August 29, 2024.
Dr. Adam underscored that the initiative is essential for Ghana’s financial stability.
He pointed out that the debt exchange could yield $4.4 billion in debt service relief and cancel $4.7 billion as part of the IMF program.
These measures are anticipated to help reduce Ghana’s debt-to-GDP ratio to 55% by the end of 2028, aligning with the target for restoring debt sustainability.
“We are pleased to officially launch our exchange offer in the coming days marking a critical study in our external debt restructuring journey.
The change offered represents the terms agreed in principle with all bondholders on June 24, 2024, including important concessions which the bondholders made to Ghana and ensuring a fair burden sharing between our domestic official and commercial external creditors.
“The exchange will be open for 21 days and we count on the full support of our bondholder community, both abroad and in Ghana to reach high participation levels.
We expect that all our outstanding bonds will be exchanged for our new bonds where investors can choose between two options; a power option with no nominal haircut but a low interest rate and a disco option with a 37% nominal haircut but a higher interest rate.
“The debt exchange will allow Ghana to save $4.4 billion in debt service relief and a cancellation of $4.7 billion over the course of the IMF programme and contribute to reducing our debt-to-GDP ratio to 55% by the end of 2028 which is the target we are hoping to achieve to restore debt sustainability.
“We thank the bondholder community for their support and hope that the successful exchange will pave the way for a nominalisation of our relationship with the international market,” he stated.
