{"id":17148,"date":"2024-06-26T09:24:13","date_gmt":"2024-06-26T09:24:13","guid":{"rendered":"https:\/\/sotnews.agency\/?p=17148"},"modified":"2024-06-26T11:40:32","modified_gmt":"2024-06-26T11:40:32","slug":"completion-of-debt-restructuring-brings-certainty-on-the-market-several-investors-had-been-waiting-for-this-news-quartey","status":"publish","type":"post","link":"https:\/\/sotnews.agency\/?p=17148","title":{"rendered":"Completion of debt restructuring brings certainty on the market, several investors had been waiting for this news \u2013 Quartey"},"content":{"rendered":"
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\n \t<\/i> Read Time:<\/span>5 Minute, 17 Second <\/div>\n\n <\/div>

The Director of the Institute of Statistical, Social and Economic Research (ISSER) of the University of Ghana, Professor Peter Quartey has said that the concussion of the debt restructuring operations has brought certainty to the market.<\/strong><\/p>\n

This is what investors had been waiting for all these years, he said.<\/p>\n

\u201cWell this announcement brings some level of certainty to the market because we have been waiting for it for far too long. Many investors both individual and corporate investors have been waiting for this news. You know uncertainty affects the financial market.<\/p>\n

\u201cFinancial system doesn\u2019t like noise, It doesn\u2019t like uncertainty and so for me clears the way for \u00a0\u00a0many things to happen. More inflows may come in. It also clear the way for people to invest properly and also it will certainly have some positive effect on the exchange rate and by extension inflation,\u201d he told journalists on Tuesday, June 25.<\/p>\n

Three major debt restructuring operations, domestic debt restructuring, external bilateral debt restructuring, and commercial bondholders debt restructuring have been successfully completed, the Finance Minister Dr Mohammed Amin Adam announced.<\/p>\n

\u201cLast two weeks, we concluded negotiations with the official creditors, and we have agreed to restructure 5.1 billion dollars. I am telling you that the government is good in negotiations and of this amount, we are going to make savings of $2 billion.\u201d<\/p>\n

Ghana\u2019s economic recovery is strongly on course \u2013 Akufo-Addo affirms<\/a><\/p>\n\n

\u201cAs I speak to you, tomorrow morning, there will be an announcement that we have also concluded our negotiations with the Eurobond Holders of $13.1 billion, and ladies and gentlemen, when we announce it, please read the details. We have negotiated a good deal for Ghana and that is $8 billion,\u201d he said at a Townhall meeting in the United Kingdom on Saturday, June 23.<\/p>\n

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Commenting on this, President Nana Addo Dankwa Akufo-Addo said while speaking at the presentation of credentials to nine newly appointed diplomats at the Jubilee House,\u00a0that many of the country\u2019s stalled projects will soon resume, thanks to successful negotiations on the restructuring of Ghana\u2019s debt.<\/p>\n

The President detailed the positive outcomes of these negotiations and their implications for Ghana\u2019s development.<\/p>\n<\/div>\n

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He said that these efforts have provided much-needed financial relief and set the stage for a renewed focus on critical infrastructure and development projects.<\/div>\n

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\u201cThese agreements have provided much-needed breathing space and put our domestic debt-to-GDP ratio on a clear downward trend,\u201d President Akufo-Addo explained.<\/p>\n

\u201cThe successful negotiations mean that bondholders will provide $4.4 billion in cash flow relief during the IMF Programme, in addition to the cancellation of $4.7 billion of the debt stock.\u201d<\/p>\n

The President highlighted the significance of the domestic debt restructuring, which achieved a high participation rate of almost 95%. Coupon rates were reduced from 21% to 9% on average, and maturities were extended, easing the near-term local debt service burden that previously consumed more than 40% of the country\u2019s tax revenues.<\/p>\n

This restructuring has set the domestic debt-to-GDP ratio on a path to reach 55% by the end of 2028. Furthermore, the external bilateral debt restructuring has been a crucial milestone in Ghana\u2019s economic recovery efforts.<\/p>\n

The agreement with bilateral creditors, coordinated through the Ghana Official Creditor Committee (OCC) and co-chaired by France and China, resulted in the restructuring of $5.1 billion of Ghana\u2019s debts.<\/p>\n

This agreement is expected to provide a cash flow relief of approximately $2.8 billion, or GH\u00a239 billion, in debt service, postponed between 2023 and 2026 to be repaid later at a cheaper interest rate.<\/p>\n

\u201cThe Agreement with our Bilateral Debt Holders will lead to a cash flow relief of around $2.8 billion or GH\u00a239 billion in debt service,\u201d President Akufo-Addo stated. \u201cThis will enable us to resume and complete many projects that are vital for our nation\u2019s progress.\u201d<\/p>\n

The successful negotiations have also paved the way for the IMF\u2019s Executive Board to convene and approve Ghana\u2019s Second Review of the Fund Programme, resulting in a further disbursement of $360 million in support of the programme. This additional funding will further bolster Ghana\u2019s efforts to revive its economy and accelerate development initiatives.<\/p>\n

One of the most notable achievements in the debt restructuring process is the agreement with commercial bondholders. The restructuring of $13.1 billion of debts resulted in significant savings for the government, including the cancellation of $4.7 billion, or GH\u00a265 billion, from the debt stock. Additionally, Ghana will save $4.4 billion, or GH\u00a260 billion, in debt service, providing further financial relief during the IMF Programme.<\/p>\n

\u201cThe savings include the cancellation of $4.7 billion from the debt stock and $4.4 billion in cash flow relief during the IMF Programme,\u201d President Akufo-Addo explained. \u201cThis comprises principal savings of $1.5 billion and interest savings of $2.9 billion.\u201d<\/p>\n

The President commended the Ministry of Finance, led by Hon. Mohammed Amin Adam, for their efforts in achieving these historic agreements. He emphasized the importance of these milestones in creating the financial space needed to resume and complete stalled projects across the country.<\/p>\n

\u201cThese achievements are unprecedented in the history of country debt restructurings,\u201d President Akufo-Addo stated. \u201cThe Minister for Finance and his team at the Ministry of Finance are to be warmly applauded for this historic achievement.\u201d<\/p>\n

With the successful debt restructuring initiatives in place, the government is now well-positioned to focus on revitalizing critical infrastructure and development projects that have been stalled due to financial constraints. These projects, which include improvements in healthcare, education, transportation, and other essential sectors, are vital for Ghana\u2019s progress and development.<\/p>\n

The President\u2019s announcement has been met with optimism and renewed hope for Ghana\u2019s economic future. The resumption of stalled projects will not only boost the country\u2019s development efforts but also create jobs and improve the quality of life for Ghanaians.<\/p>\n

As Ghana continues on its path to economic recovery, the successful debt restructuring and the resumption of stalled projects signify a significant step forward in the nation\u2019s journey towards sustainable growth and prosperity.<\/p>\n

The post Completion of debt restructuring brings certainty on the market, several investors had been waiting for this news \u2013 Quartey<\/a> first appeared on 3News<\/a>.<\/p>

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