Gov’t debunks reports of debt restructuring with local contractors

The Ministry of Finance has refuted recent reports suggesting that the government is engaging in debt restructuring negotiations with private banks and local contractors.

According to the Ministry, such claims are unfounded, as no debt restructuring with local contractors has been contemplated or initiated, either during or after the domestic debt restructuring programme that began in December 2022 and concluded in October 2023.

The clarification comes after media reports misinterpreted remarks made at a recent Monthly Press Briefing on the Economy, held on 29th August 2024.

“During a recent Monthly Press Briefing on the Economy held on 29th August 2024, a question was raised regarding external commercial debt restructuring, the response to which was misinterpreted to mean that obligations to local contractors were going to be restructured.

“To clarify, debt restructuring refers to the reorganisation of Ghana’s stock of debt, comprising loans and bonds. Domestic contractors’ liabilities, on the other hand, are payment claims, not loans or bonds, and do not fall under the category of obligations eligible for restructuring.

“The Ministry of Finance has never engaged or invited contractors for debt restructuring discussions, a fact corroborated by contractors in a recent interview with JoyNews,” the ministry stated in a press release dated September 9, 2024.

The Ministry also clarified that the completed Domestic Debt Exchange Programme (DDEP) was exclusively focused on domestic bonds held by the Central Bank, Pension Funds, and retail debt investors. It did not encompass contractor payments or any obligations related to them.

Following the completion of the DDEP, the Ministry has made strides in restructuring external debt, including the successful negotiation of a Memorandum of Understanding (MOU) with the Official Creditor Committee under the G20 Common Framework.

The Ministry also launched the Consent and Exchange Solicitation process for Eurobond debt and commenced engagements with external commercial creditors, with hopes of reaching a beneficial agreement in the coming weeks.

It therefore expressed gratitude for the public’s support during the complex debt restructuring efforts and urges the citizenry to disregard the incorrect information about any restructuring involving contractors.

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