Ghana’s Parliament has given its crucial approval to a $2.8 billion debt restructuring deal with 25 creditor nations, a significant step that is expected to unlock further disbursements under the country’s International Monetary Fund (IMF) bailout program. This parliamentary endorsement, occurring late yesterday, Tuesday, June 24, formalizes an agreement that has been months in the making, aimed at restoring the West African nation’s long-term debt sustainability.
The deal, which provides Ghana with a substantial debt service relief of $2.8 billion during the IMF-supported program period, will enable the government to redirect vital financial resources towards economic recovery initiatives and critical development projects. While the Memorandum of Understanding (MoU) with the Official Creditor Committee (OCC) was fully signed by all 25 participating creditor countries as early as January 2025, parliamentary approval was a necessary domestic step for its full implementation.
Ghana embarked on this comprehensive debt restructuring exercise, encompassing both domestic and external creditors, as part of a three-year IMF program initiated in May 2023. The overarching goal is to reduce the debt-to-GDP ratio to below 55 percent by 2028 and lower the debt service-to-revenue ratio to under 18 percent from 2028 onwards.
The Ghanaian government has expressed immense gratitude to China and France, who co-chaired the creditor committee, for their leadership and facilitation throughout the complex negotiation process. The approval by Parliament now paves the way for the implementation phase, which will proceed through bilateral agreements with each member of the OCC. Authorities have committed to expediting these individual arrangements to ensure swift execution of the debt treatment plan.
