Dr. Theo Acheampong, a policy analyst and economist, has issued a warning that Ghana may struggle to obtain a debt relief of about US$10.5 billion from external creditors including bilateral lenders.
The policy analyst asserted that it will be challenging for the country to achieve $2.6 billion in yearly debt relief for the following four years, based on experiences from Zambia and other countries.
A request for debt restructuring has already been made by Ghana to its official creditors. However, Dr. Acheampong stated in an interview that the country might not receive a good deal from the external creditors.
“What Ghana wants to do is to get as much as 10 and half billion dollars of relief coming from the creditors over the course of the next three, four years under the IMF programme. So, more than half of the $20 billion debt is what it’s looking to get from them [external creditors], and that translates to about $2.6 billion every year that Ghana hopes to get in the form of relief or retrieve from these creditors.
“It’s going to be a bit difficult because we’ve seen similar instances with the likes of Zambia. But there’s been a major contestation around how we treat certain creditor groups. ”Dr. Theo Acheampong
He continued by saying that Ghana is overexposed to commercial loans and Eurobonds.
“So, I think the road ahead is going to be quite challenging in the sense that all the $2.6 billion creditors need to get every year, it probably will not amount to that and this is just on the basis of some of the evidence we’ve seen with other countries that have attempted to go down this road.”Dr. Theo Acheampong
In addition to the fact that most commercial creditors have obligations to their shareholders, Dr. Acheampong continued by noting that “Ghana in a way defaulted on making the interest payment on a number of these debt obligations since December of last year.“
Dr. Badu-Aboagye Assures Ghanaians Of A Better Tommorrow
Meanwhile, citizens of Ghana has been assured by Mark Badu-Aboagye, the Chief Executive of the Ghana National Chamber of Commerce and Industry (GNCCI) that the current economic crisis will soon be a thing of the past.
According to Mr. Badu-Aboagye, Ghana’s economy will undoubtedly change as a result of the government’s conclusion of the International Monetary Fund (IMF) deal.
“The outlook is good,” he said, sounding optimistic about the future.
“It will get better, but for this year, things will be a bit rough. So, if you’re taking a decision for the year, you should know that these adjustments are going to affect you.”Mark Badu-Aboagye
Touching on the conditionality that accompanies the IMF deal, Mr Badu-Aboagye said the government rolled most of them before the deal was complete, hence, things will only get better from here.
“I strongly believe that we will sail through this difficult moment. And of course, for this year, we do not expect that people will make a lot of profit even by looking at the economic activities.
“But next year and in subsequent years, it will pick up. And I think the reason is that most of the conditionalities were front-loaded, so we are feeling the pinch now, ones we get used to it the good things will follow.”Mark Badu-Aboagye
On Friday, May 19, the Bank of Ghana received US$604 million, the first installment of Ghana’s US$3 billion bailout from the International Monetary Fund.
Prior to the bailout, the Governor of the central bank, Dr. Ernest Addison noted that the money would boost the country’s reserves and the Cedi which is already doing very well in recent times.