DAILY TRUST
The current debt crisis rocking Ghana, which has seen the country suspending interest payments on most of its foreign debts, including its Eurobonds, has brought to the fore the need for circumspection in the management of African economies.
It said the suspension was an interim emergency measure pending future agreements with all relevant creditors.
To resolve its fiscal challenges, the Ghanaian government has taken a number of rather drastic measures. First, it entered into talks with the International Monetary Fund for a $3 billion facility to enable the country to restore macroeconomic stability and debt sustainability. Talks between the government and fund’s officials ended by mid-December, with a staff-level agreement, which means that subject to board approval in early 2023, Ghana will receive the facility.
But the situation in Ghana is taking a large toll on the government and putting so much pressure on the entire nation. This has forced the government to take further drastic actions. It announced on December 4 a domestic debt exchange under which it said all existing bonds as of December 1, 2022, would be replaced by a set of four new bonds that mature in 2027, 2029, 2032, and 2037. It said holders of the new bonds will receive zero coupons in 2023, 5% in 2024, and 10% in 2025, until maturity…
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