Ghana talks with exterior bondholders due in a couple of weeks


By Christian Akorlie

ACCRA (Reuters) – Substantive discussions with Ghana’s exterior bondholders are attributable to begin within the subsequent few weeks, the nation’s Finance Minister Ken Ofori-Atta instructed parliament on Thursday.

Embattled Ghana has to restructure its debt to safe a $3 billion Worldwide Financial Fund (IMF) bailout, which Ofori-Atta mentioned the federal government hoped to safe in March.

Round 85% of eligible bondholders registered for a long-delayed home debt change programme this week, after a number of extensions and revisions to the phrases.

Eligible bondholders held 97.7 billion cedis ($8.1 billion) of presidency bonds initially slated for restructuring that have been price 130 billion cedis on the finish of December, Ofori-Atta mentioned, with pension funds excluded after unions threatened a common strike.

Particular person bondholders aged beneath 59 and collective funding schemes accounted for six.06% of the tendered eligible bonds, people over 59 for 0.43% and different holders, together with banks and insurance coverage corporations, for 78.41%, he mentioned.

The federal government should now get commitments from its exterior collectors to a debt restructuring to safe IMF government board approval for the rescue bundle.

“Now we have began the method of negotiating in good religion with our industrial collectors by preliminary discussions and change of data,” Ofori-Atta mentioned.

The industrial creditor committee had dedicated to assessing Ghana’s request for debt aid by the top of February, he mentioned.

On the finish of November, a 3rd of Ghana’s 575.7 billion cedi ($48.4 billion) debt was home, in response to the central financial institution, whereas exterior debt was $29.2 billion. The nation owes about $13 billion to worldwide bondholders.

“We hope our industrial collectors will perceive our need to barter with our bilateral collectors softer phrases than those we anticipate to suggest to them, as a speedy course of with the bilateral collectors is required to pave the best way for the dialogue with non-public collectors,” Ofori-Atta mentioned.

Ghana, the place a deep financial disaster has seen inflation and the federal government’s debt servicing prices spiral, has requested a bilateral debt restructuring beneath the Widespread Framework, a course of arrange in the course of the COVID-19 pandemic by the Group of 20 main economies.

“We made it identified that we count on the (bilateral) creditor committee to be shaped in an expeditious method … to make sure that we’re capable of go to the Fund’s board in March,” Ofori-Atta mentioned, of the assembly, co-hosted by the Paris Membership of creditor nations, the place the request was offered.

“We’re additionally approaching main collectors like India and China to make sure that our discussions with the Paris Membership is accelerated.” 

China is Ghana’s greatest bilateral creditor with $1.7 billion of debt, whereas Ghana owes $1.9 billion to Paris Membership members, in response to information from the Institute of Worldwide Finance.

($1 = 12.0000 Ghanaian cedi)

(Reporting by Bate Felix and Christian Akorlie; Writing by Sofia Christensen and Rachel Savage; Enhancing by James Macharia Chege, Christina Fincher and Shounak Dasgupta)