Government debunks reports of debt restructuring with private banks, local contractors

The Ministry of Finance has debunked publications that the government is engaging in debt restructuring with private banks and local contractors.

According to the ministry, no such restructuring has been contemplated during or after the domestic debt restructuring program, which commenced in December 2022 and came to a firm close in October 2023.

In a release on September 9, 2024, the ministry said “During a recent Monthly Press Briefing on the Economy held on 29th August 2024, a question was raised regarding external commercial debt restructuring, the response to which was misinterpreted to mean that obligations to local contractors were going to be restructured.

“To clarify, debt restructuring refers to the reorganization of Ghana's stock of debt, comprising loans and bonds. Domestic contractors' liabilities, on the other hand, are payment claims, not loans or bonds, and do not fall under the category of obligations eligible for restructuring,” it said.

The Ministry of Finance said it has never engaged or invited contractors for debt restructuring discussions, a fact corroborated by contractors in a recent interview with JoyNews.

It added that the completed Domestic Debt Exchange Programme (DDEP) only covered domestic bonds held by the Central Bank, Pension Funds, and retail debt investors, with no mention of contractors' payments.

“Following the DDEP, the Ministry has made significant progress in external debt restructuring, including:

a. Completing an MOU with the Official Creditor Committee under the G20 Common Framework

b. Launching the Consent and Exchange Solicitation process for Eurobond debt

c. Commencing engagement with external commercial creditors to reach a beneficial solution in the coming weeks,” it concluded.

SSD/ ADG