IMF Boss advised Akufo-Addo not to allow Eurobond holders to twist his arm –
The International Monetary Fund (IMF) is warning that Ghana's three bailout packages may be in jeopardy if the country fails to secure a fair restructuring deal with Eurobond holders.
The Finance Ministry has had a tough time forcing through a domestic restructuring programme, which was widely criticised by all stakeholders. Hopes were high that the country would have smooth sailing after it secured creditor assurance from the official creditor committee, which includes China.
However, in a meeting with President Akufo-Addo during an official visit to Ghana, Managing Director of the IMF, Kristalina Georgieva said Ghana may suffer severe setbacks similar to the case in Zambia, where they have difficulties unlocking the full bailout package.
Ghana currently needs to restructure a total of approximately $13 billion, which it owes to Eurobond holders.
Kristalina Georgieva
Kristalina Georgieva said Ghana must not allow itself to be arm-twisted by the Eurobond market.
“The sooner we do a great deal the better for the country. To do a deal that may actually reverse progress is not going to be good for the country. You cannot allow the Eurobond creditors to twist your arm. Why? Because you have done a very painful domestic debt restructuring, you have agreed in principle on debt restructuring with the official creditors of Ghana under certain conditions. The deal with the Eurobond has to be a fair deal vis-a-visa what was already done otherwise we risk seeing what happened in Zambia,” she stated.
According to the Managing Director of the Fund, her meeting with President Akufo-Addo came at an opportune time that will be quite decisive for years to come, “because we are climbing a mountain and we are doing quite well, we are not yet at the top, we need to keep climbing so there’s radiation of responsibility we need to complete with private creditors but complete defending the interest of the country.”
In January this year, the Finance Ministry announced that Ghana had received the second tranche of $600 million from the IMF.
Then Finance Minister, Ken Ofori-Atta, explained that the IMF has approved all required financing assurances from Ghana's official creditors.
Source: Don’t allow Eurobond holders to twist your arm – IMF Boss to Akufo-Addo - MyJoyOnline
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