Ghana likely to get less than expected in external debt savings – Theo Acheampong

Economist and political risk analyst, Dr. Theo Acheampong, is predicting Ghana will likely get less than its expected savings for the external debt restructuring.

Ghana following the successful completion of the domestic debt exchange, had targetted some $10.5 billion in external debt service relief from 2023-2026 as it aims to reduce the public debt-to-GDP ratio by 2028 to 55% from the 88.1% it stood at the end of 2022.

The country this year was expected to have gotten in total about 4.2 billion dollars in terms of extra financing from both the IMF ($1.2bn) and the restructuring of its external debts ($2.bn), but has been left with only the $600m it received from the first tranche disbursement under the IMF deal as the country struggles to reach an agreement with its official creditors to help release the second $600m tranche.

But speaking at roundtable on the state of Ghana’s economy, Dr. Acheampong who is also senior analyst on the Economics and Country Risk Sub-Saharan African team at S&P Global Market Intelligence, says the inability of the country to meet its financing target could be problematic.

“Already by the end of this year we would have missed our target on the financing we were to receive because we have not done the full external debt restructuring. So, if you take 600 million from the IMF and divide that by 4.2 billion you get less than 30% of what you are supposed to be coming through this year,” he said.

“So already we have got some problems that we need to address going into 2024. In my view, it is going to be further challenges to be able to get the full measure of what we are looking to get from the external debt restructuring,” he concluded.

Meanwhile, Finance Minister, Ken Ofori-Atta, says Ghana is open to any new cut-off date by external creditors for the restructuring of Ghana’s external debt.

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