IMF and Ghana are a step away from completing deal
2022.12.09 15:11
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IMF and Ghana are a step away from completing deal
Budrigannews.com – According to three people with knowledge of the ongoing negotiations, the International Monetary Fund (IMF) and Ghana are expected to reach a staff-level agreement on a loan deal by Tuesday at the latest.
A request for comment was made, but the IMF did not immediately respond. Ghana’s finance ministry said they couldn’t say anything other than that the talks were still going on.
According to two sources, the IMF program was anticipated to be an extended credit facility that provides countries with financial assistance.
According to one of these sources and a third, significant obstacles in the negotiations were overcome this week, accelerating the process.
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In July, Ghana sought assistance from the International Monetary Fund (IMF), which has sent a team to the nation until Tuesday.
As the West African nation confronts its worst economic crisis in a generation, Finance Minister Kenneth Ofori-Atta has stated that he is hoping for a relief package of up to $3 billion, possibly spread out over a three-year period.
The West African nation that produces oil, gold, and cocoa has stated that it requires the agreement by the end of the year.
This week, the government launched a plan to replace $10.5 billion in local bonds with new ones as part of its debt restructuring. According to Aviva’s Carmen Altenkirch, the country “will be in a significantly better position because it addresses the near term external liquidity challenges” if a domestic debt restructuring is “done in a coherent manner, with the support of the IMF and the local banking system.” Analyst for sovereign markets for investors.
According to a person with knowledge of the situation, the conditions for restructuring external debt were the last obstacle, and an agreement was anticipated to be reached on Friday.
According to Renaissance Capital’s global chief economist Charlie Robertson, “Ghana’s government did not go to the IMF and did not slash budget expenditures after December 2020.” It then defaulted on its domestic debt as a result of rising global borrowing costs in 2022.”
According to Tradeweb data, the majority of Ghana’s international bonds traded at deeply distressed levels of 30-33 cents per dollar on Friday.
