Ghana has finally reached an agreement in principle with its Eurobond holders to restructure its $13.1 billion debt.
The country initially announced the suspension of payments on some of its external debt in December 2022, marking the beginning of steps to restructure debts after seeking assistance from the International Monetary Fund (IMF) due to its distressed debt status.
After a year and a half of negotiations, the committee of Ghana’s Eurobond holders has confirmed an agreement in principle with the Akufo-Addo-led government regarding the restructuring. Terms of the agreement indicate that bondholders will accept a 37% nominal haircut on accrued amounts up until December 31, 2023.
Under the terms, the Government will also reinstate and implement an amended Fiscal Responsibility Act, which was suspended during the COVID-19 pandemic. In return, bondholders will forego $4.7 billion of their claims and provide cash flow relief amounting to $4.4 billion during the period of the IMF program.
Non-financial provisions outlined in the agreement include semi-annual disclosure of public debt, a most-favored-creditor clause, and a loss reinstatement clause.
In total, 15 Eurobonds have been restructured, with the latest maturity date extended to 2037.
Attached is the press release detailing the full terms of the agreement:
Press-Release-Ghana-Committee-Announcement-of-Agreement-in-Principle-June-2024
By: Ekow Annan/newsalertgh.com
