Audio By Carbonatix
Global rating agency, S&P, has projected that Ghana’s public debt to Gross Domestic Product (including COCOBOD obligations) will remain above 60% of GDP in gross terms till 2027.
According to the New York based firm, debt levels will remain sensitive to growth, fiscal, and balance-of-payments outcomes, including those beyond the June 2026 end date of Ghana's International Monetary programme.
“We estimate that, post-exchange, foreign currency debt still makes up around 66% of total government debt (assuming a 99% participation rate in the Eurobond exchange, with 91% of holders choosing to swap into the discount notes)”.
It warned that it could lower the outlook on Ghana's local currency ratings to negative should the country’s fiscal and external outcomes worsen.
On the downside risk, S&P said it could raise the long-term foreign currency rating if Ghana completes the restructuring of the remaining commercial debt, adding, “Our analysis will incorporate the sovereign's post-restructuring credit factors, including the new terms and conditions of its external debt.
We could raise the local currency ratings if Ghana makes further progress on stabilising its public finances, and accumulating foreign currency reserves”
S&P assigned 'CCC+' foreign currency issue rating to Ghana's five categories of new notes following the completion of the government's distressed debt exchange on Eurobonds.
The exchange offer received the consent of the required majority of Ghana's Eurobond holders. The restructuring of Ghana's $13.1 billion in Eurobonds plus arrears aimed to ease external debt-service pressure and restore public debt sustainability as part of the ongoing Extended Credit Facility (ECF) arrangement with the IMF.
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