Indexing government scandals one at a time
Ghana has suspended payments on most of its external debt, effectively defaulting as the country struggles to plug its cavernous balance of payments deficit.
The finance ministry said that it will not service debts including its Eurobonds, commercial loans and most bilateral loans, calling the decision an “interim emergency measure”, while some bondholders criticised a lack of clarity in the decision.
The suspension of debt payments reflects the perilous state of the economy, which had led the government last week to reach a $3bn staff-level agreement with the International Monetary Fund (IMF).
Ghana had already announced a domestic debt exchange programme and said that an external restructuring was being negotiated with creditors. The IMF has said a comprehensive debt restructuring is a condition of its support.
Dec. 20, 2022