Ghana reaches agreement with bilateral creditors over debt restructuring

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Ghana has obtained a Memorandum of Understanding (MoU) regarding the restructuring of its debts from its bilateral creditors.

This came about following the official creditor committee members’ and Ghana’s bilateral creditors’ successful acquisition of the required parliamentary and national approvals on the parameters of Ghana’s debt restructuring, as previously agreed upon this year.

The committee is expected to release a statement shortly confirming the agreement, according to the media.

According to sources, the Memorandum of Understanding was delayed despite the agreement being reached in February 2024 because of the document’s writing.

Under the G20 Common Framework debt treatment, Ghana obtained “an agreement in principle” with the bilateral creditors in January 2024.

This aided the nation in finishing the IMF program’s first evaluation.

Ghana was given an additional $300 million by the World Bank as part of the Development Policy Operation Financing, totaling $600 million.

This cleared the way for the government to proceed and negotiate the parameters of a five-billion-dollar debt restructure under the Memorandum of Understanding between Ghana and its Official Creditor Committee.

During a recent visit to Ghana, the IMF’s Managing Director, Kristalina Georgieva, disclosed that Ghana was on the verge of signing a Memorandum of Understanding (MoU) with its bilateral creditors about the restructuring of the debt.

“Due to its progress in debt restructuring talks with bilateral creditors, Ghana is in a strong position right now.”

“Very real progress has been made in the direction of signing a Memorandum of Understanding with bilateral creditors,” she noted.

According to her, striking an agreement with the creditors should free up funds for the government to invest in vital initiatives that support economic stabilization.

The issuance of the Memorandum of Understanding by the Official Creditor Committee Co-Chaired by France and China might expedite the process of the IMF’s second review report reaching the Management and the Board for approval in June 2024.

This will help release up almost $360 million for Ghana.

The payment may contribute to strengthening Ghana’s foreign reserves. Additionally, it will convey a favorable message to investors and contributors.

Source: Ghanatodayonline.com

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