Too early to speculate on debt restructuring, says IMF

The International Monetary Fund (IMF) has cooled speculation that Ghana is poised to start talks on restructuring its debt under plans to secure a US$3 billion loan from the Fund.

According to the Bretton Woods institution, the restructuring of Ghana’s debt will depend on the outcome of an IMF debt sustainability analysis (DSA) report.

The IMF director of communications, Gerry Rice, who disclosed this at a news conference in Washington, DC, said the DSA report will show if there is need for debt restructuring in the first place and, if necessary, how it should be carried out, as well as which areas will be affected.

“When a country requests financing from the IMF, we assess whether the country’s policies are consistent with debt sustainability as one of our requirements,” Rice said. “We still need to conduct a thorough update of the debt situation in Ghana through our debt sustainability analysis.

“The last (I don’t know if it’s useful) – I have here the last DSA, debt sustainability analysis. We published this as part of the 2021 Article IV Staff Report with Ghana. It said public debt was sustainable conditional on a rigorous and credible implementation of the authority’s medium-term consolidation plan to put debt on a declining trajectory and ensure continued market access,” he said.

This, Rice said, will inform the next line of action, as the Government of Ghana and the Fund remain committed to ensuring no harm is done to the interest of stakeholders as a result of a new budgetary support programme.

An IMF negotiation team arrived in Accra on Monday (26 September 2022) to continue official negotiations with the government over the loan request.