Audio By Carbonatix
Ghana has received a draft term sheet on debt relief from its official creditors that is sufficient for the International Monetary Fund to disburse $600 million to the West African nation, Finance Minister, Ken Ofori-Atta said.
The term sheet from the Paris Club Group of creditors and new ones including China comes after months of negotiations to restructure as much as $5.4 billion of bilateral debt. The IMF board is expected to meet in a week.
“We are reviewing the draft term sheet,” Ofori-Atta said in an interview in the capital, Accra, declining to provide details in the draft accord.
“We need to scrutinize every clause but in terms of the broad framework, all parties are in agreement so it’s kind of a clearance to the fund. I’m hoping by tomorrow we would have finished so that whatever needs to be done will be sent to the fund,” he said.
Ghana started restructuring most of its public debt in December 2022 to qualify for a $3 billion extended credit facility program with the IMF. The country received an upfront disbursement of $600 million when it agreed to the program in May. Further releases, however, depend on meeting debt-rework and other performance targets.
Public debt — excluding loans to state-owned enterprises — eased to 66.4% of gross domestic product at the end of September, helped by the completion of a domestic debt reorganization. Those investors mainly suffered interest-rate cuts when they swapped about 126 billion cedis ($10.5 billion) of local debt last year.
A memorandum of understanding with the bilateral lenders could also unlock $550 million of additional funding from the World Bank by the end of February, Ofori-Atta said last week.
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