In a significant announcement during the mid-year budget review on Tuesday, July 23, 2024, Finance Minister Dr. Mohammed Amin Adam revealed that Ghana has achieved substantial debt relief amounting to $2.8 billion following the completion of the government’s debt restructuring efforts.
Dr. Amin Adam highlighted that this relief, a result of negotiations with the Official Creditor Committee (OCC), covers $5.1 billion of debt and translates to approximately $8 billion in total debt relief. This restructuring will spare Ghana from servicing its debt obligations to official creditors until 2026.
“We have completed the debt restructuring programme with the Official Creditor Committee (OCC), covering US$5.1 billion, resulting in approximately US$8 billion of debt relief. This means that we will not service our debt to our official creditors from 2023 to 2026,” Dr. Amin Adam announced to Parliament.
In addition to this relief, the Finance Minister disclosed that Ghana has secured a credit facility of about $1.6 billion from the International Monetary Fund (IMF). The country has also concluded negotiations with Eurobond holders, securing $13.1 billion. This agreement includes the cancellation of $4.7 billion in debt and provides debt service relief of $4.4 billion from 2023 to 2026.
“These negotiations will lead to a cancellation of 4.7 billion US dollars of our debt and provide debt service relief of 4.4 billion US dollars between 2023 and 2026,” Dr. Amin Adam stated.
Furthermore, Dr. Amin Adam announced significant savings through successful negotiations with independent power producers. The government has concluded talks with five out of seven power producers, resulting in a projected savings of $6.6 billion over the lifetime of the purchasing power agreements (PPAs).
The Finance Minister’s mid-year budget review underscores the government’s efforts to stabilise Ghana’s economy, reduce debt burdens, and secure financial support to spur economic growth and development. This fiscal strategy aims to provide a sustainable path forward for the nation amid global economic challenges.