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The Official Creditor Committee (OCC) and the Ghanaian government have reached a Memorandum of Understanding (MoU).
China and France, two countries that were instrumental in the negotiations, co-chaired the agreement, which deals with the debt treatment that was decided upon in January 2024.
In order to restore Ghana’s long-term financial sustainability, the MoU formalizes the deal in principle struck with the Official Creditors in January.
“The financial terms of the agreement remain unchanged, providing significant debt service relief during the Fund-supported programme period,” stated Mohammed Amin Adam, the finance minister.
He pointed out that this alleviation would make it possible to reroute financial funds to vital sectors like infrastructure, healthcare, and education.
The IMF Executive Board is anticipated to approve the second review of the Fund-supported Post-COVID-19 Programme for Economic Growth (PC-PEG) following the formalization of the OCC agreement. With this permission, the $360 million next tranche of IMF assistance can be disbursed more easily. Furthermore, it is expected that the approval of the IMF Board will enable additional financial support from development partners, including the World Bank.
Additionally, it is anticipated that the deal will strengthen current negotiations with private creditors, with whom Ghana is dedicated to reaching a similar settlement as soon as feasible. Dr. Adam asked official creditors to sign the bilateral agreements needed to put the MoU into effect as soon as possible by accelerating their internal procedures.
“We call upon our official creditors to fast-track their internal processes towards the signing of the bilateral agreements,” He stated. Ghana is still attempting to finalize restructuring agreements that honor both the concept of comparability of treatment and Ghana’s demand for debt relief, while still engaging in good faith negotiations with all commercial external creditors.
Dr. Adam conveyed his appreciation to the OCC members for their steadfast support, particularly to China and France, the committee’s co-chairs. “This landmark agreement marks an extraordinary milestone in Ghana’s debt restructuring journey and will further strengthen our ambitious reform agenda with the strong support of our development partners,” he said.
The historic deal is anticipated to strengthen Ghana’s will to reforming its economy beyond help and lay a strong foundation for the country’s sustainable development and economic recovery.
Source: Ghanatodayonline.com
