Finance Minister, Ken Ofori-Atta, has stated that Eurobond holders may face a nominal haircut of between 30% and 40% as part of the restructuring of the external debt.
According to him, coupons may also not exceed 5% with final maturities of not more than 20 years.
“So in our indicative scenario, the restructuring terms for bondholders involve maybe a nominal haircut between 30 and 40%, looking at maybe coupons of not more than 5% and final maturities of not more than 20 years are sort of the contours of what we are discussing and analyzing”.
Updating investors about the state of Ghana’s debt restructuring in London, Mr. Ofori-Atta said Ghana has no antipathy towards any financial instrument, ensuring that every investor’s position will be respected.
“As a country, as a people, we have no antipathy towards any instrument which would ensure that everybody’s position is respected and we get to an end which makes the country stronger for us to come back to the market. So, we are hoping to complete any instrument provided it aligns with the IMF Debt Sustainability Analysis and its financial, legal, and politically acceptable and will lead us to quicker robustness of our economy”, he explained.
He also mentioned that both parties want a win-win situation.
“I think for all of us we want a certain amount of certainty and therefore in my view, there is a positive premium to simplicity and clarity and we may be able to find it in many ways. So simplicity and clarity means that they can be explained to the domestic public and that the market can value and price the instrument efficiently and it will move us forward and not delay any issues”.
Continuing, Mr. Ofori-Atta said “We don’t make the rules but we have reached a Staff-Level Agreement with the IMF on October 6th [2023] regarding the first review of the programme; and truly I think we need to acknowledge the type of work that has occurred, starting this programme in July of last year against all odds in a very turbulent environment we did get our SLA in December [2022] and then moved on to the board approval in May [2023] which was really the fastest”.
Ghana’s total outstanding Eurobond payment is estimated at $13.10 billion, captured in the 2022 Annual Debt Report by the Ministry of Finance.