Ghana debt restructuring: Special talks with China shifted to 3rd week of March

Ghana has shifted its meeting with Chinese creditors over debt restructuring to the third week of March, raising concerns over how long it will take to conclude an external debt restructuring.

An earlier meeting that was scheduled for the last week of February was cancelled on Wednesday, February 22, Graphic Business has learnt.

Finance Minister, Ken Ofori-Atta, was due to meet representatives of the Chinese government and its quasi agencies in Beijing from February 26 on how the Asian giant could support the world’s second biggest cocoa grower with softer debt repayment terms.

A source, however, said that meeting has been shifted forward to allow the Chinese government to concentrate on their annual National People's Congress (NPC), which opens on March 5 in Beijing.

The turn of events could affect Ghana’s timelines for an IMF-assisted programme of up to $3 billion to resuscitate the economy.

The country needs to conclude debt restructuring negotiations with its creditors to be able to secure an Executive Board approval for the programme.   

Mr Ofori-Atta’s team of negotiators are asking the country’s external creditors to allow for interest payment suspension for the public debt stock to come under sustainable levels.

A similar exercise was concluded with domestic creditors during which a total of GH¢83 billion costly and short-term bonds were swapped for cheaper and long-term.

China and its agencies hold about $1.7 billion of Ghana’s $5.5 billion bilateral debt and the specialised nature of their lending windows means that Ghana cannot add them to the model used to negotiate with the G20 and the Pari Club members.

It is not clear what a delayed meeting with Chinese creditors will mean to Ghana’s hope of securing an IMF programme in March.

The IMF Executive Board is due to meet in March to consider similar requests from member countries.