Ghana has successfully completed its external debt restructuring with Eurobond holders, achieving a 98 per cent exchange on the country’s US$13 billion debt.
Dr. Mohammed Amin Adam, the finance minister, stated that the agreement, finalised in approximately nine months, surpassed the 65 per cent international benchmark set by bondholders.
“We obtained more than 98 per cent consent which is significantly higher than the 65 percent threshold from bondholders following the launch of the Exchange Offer and Consent Solicitation in September 2024,” he said.
The Minister disclosed this during a press briefing in Accra on Thursday, where he outlined the outcomes of Ghana’s Eurobond restructuring.
He stated that the development resolves Ghana’s default on international bonds and paved the way for normalised financial relationships with rating agencies and international markets.
“This swift action showcases the government’s unwavering commitment to restoring financial and debt sustainability… and the strong support of Ghana’s bondholder community across Africa and in the international markets,” he noted.
Highlighting the key benefits of the agreement, the Minister noted a 37 per cent reduction in the nominal value of the country’s debt, amounting to US$5 billion.
He also mentioned that the country’s debt service stood at US$4.3 billion, and the average interest rate on bonded debt had decreased from over eight per cent to less than five per cent.
The conclusion of the Eurobond debt restructuring follows Ghana’s completion of its Domestic Debt Exchange Programme (DDEP) and the agreement on a Memorandum of Understanding (MoU) with its Official Creditors Committee (OCC).
The process began with the initiation of the exchange offer and consent solicitation on September 5, 2024.
Ghana’s Eurobond restructuring included two options a PAR Option, which involves no nominal haircut, a lower interest rate of 1.5 percent, and a tenure until 2037.
The second a DISCO option involves a 37 percent nominal haircut, higher interest rates of between five and six percent and shorter maturity from 2029 to 2035.
For both options, bondholders would receive Post-Default Interest (PDI) notes as compensation for interest payment arrears up to December 2023.
Source; GNA
