News Guide Africa

Tag: EuroBond

  • Ghana beats deadlines to pay over US$2.1bn in Eurobond debt since Jan. 2025

    Ghana beats deadlines to pay over US$2.1bn in Eurobond debt since Jan. 2025

    By Adnan Adams Mohammed

     

    In a major development that signals a dramatic turnaround for the nation’s financial standing, the Government of Ghana has successfully settled a massive US$700 million Eurobond obligation well ahead of its scheduled deadline.

    The transaction marks one of the country’s largest single debt-service payments since it began restructuring its external bonds following the highly publicized 2022 default.

    According to an official statement issued by the Ministry of Finance, the strategic payment was fully executed and completed on Thursday, July 2, 2026.

    With this latest ahead-of-schedule settlement, Ghana has now injected a staggering total of US$2.1 billion back to Eurobond holders since January 2025 under the strict terms of its Eurobond Debt Exchange Programme.

    Breaking Down the Figures

    Financial analysts have closely watched the transaction, which represents a massive chunk of liquid capital. The latest US$700 million package is mathematically split into two key components:

    ● US$525.2 million allocated purely for direct principal repayments.

    ● US$174.8 million utilized to clear accrued interest payments.

    Significantly, the Ministry of Finance emphasized that the massive transaction did not disrupt local currency stability. The entire process was handled smoothly through the government’s carefully planned internal financing arrangements.

    Crucially, officials confirmed the payment was executed “without undue pressure on the country’s foreign exchange reserves,” a feat that signals vastly improved liquidity conditions and stabilizing macroeconomic indicators across the board.

    Restoring Defiant Investor Confidence

    The structured repayment program was originally engineered to completely replace the high-yield, unsustainable terms of Ghana’s legacy Eurobonds after the country launched a comprehensive external debt overhaul. By meeting and systematically beating these restructured deadlines, the government is sending an aggressive, clear message to international capitals and credit rating agencies.

    “The settlement reduces Ghana’s outstanding Eurobond debt and strengthens investor confidence in the country’s ability to manage its obligations,” the Ministry stated confidently.

     

    The Treasury further added that the proactive payment demonstrates a “steadfast commitment to disciplined public financial management and long-term macroeconomic stability.”

    The Path to Stabilization

    Ghana’s broader economy has shown remarkably steady signs of stabilization over the past several months. Inflation, which peaked at highly disruptive, volatile double-digit levels throughout 2024 and early 2025, has progressively eased under the strict anchor of an ongoing International Monetary Fund (IMF) supported program.

    While the Ministry of Finance did not publicly disclose the exact remaining balance left on the restructured Eurobonds, it took steps to reassure the local public that the country’s treasury is safe. Moving forward, the government will continue to enforce strict fiscal buffers to sustainably finance the nation’s ongoing development agenda without sinking back into unsustainable borrowing cycles.

    Closing out the official briefing, the ministry expressed profound gratitude to the local population for enduring the worst of the economic squeeze. The statement warmly thanked the good people of Ghana “for their continued patience, support, and confidence” throughout what has undoubtedly been a challenging but ultimately rewarding restructuring process.

     

  • Gov’t closes 2025 with boosted investor confidence …settles $1.4bn bondholders debt

    Gov’t closes 2025 with boosted investor confidence …settles $1.4bn bondholders debt

    Ghana’s Ministry of Finance has made a significant stride in the country’s economic recovery by settling a US$709 million Eurobond obligation ahead of its due date on December 30, 2025.

    This payment brings the total amount paid to Eurobond holders in 2025 to US$1.4 billion, comprising two earlier installments of US$349.52 million each and the latest US$709 million payment.

    Finance Minister, Dr. Cassiel Ato Forson, emphasized that this timely settlement reinforces Ghana’s credibility as a sovereign borrower and demonstrates the government’s commitment to restoring investor confidence through transparent and disciplined debt-service practices.

    “This achievement underscores our dedication to prudent debt management and macroeconomic stability,” Dr. Forson said. “We will continue to intensify reforms in domestic revenue mobilization, public financial management, and public debt management to ensure long-term fiscal sustainability.”

    The government has expressed gratitude to Ghanaians for their support and patience throughout the economic recovery process, acknowledging that public cooperation has been instrumental in the progress achieved so far. The Ministry has also appealed for continued forbearance as additional economic reforms are implemented in the coming year to consolidate the gains made in 2025.

     

     

     

     

     

     

     

  • Gov’t prepares to honor US$1.4bn Eurobond debt servicing next year

    Gov’t prepares to honor US$1.4bn Eurobond debt servicing next year

    The Government of Ghana as part of its Eurobond debt servicing obligations under the Debt Restructuring negotiations has made the last batch payment for 2025, of US$349.52 million.

    This is bringing the total of payment made towards Eurobond servicing since October 2024 to US$1,174.64 million.

    The Ministry of Finance in a statement released last week gave the breakdown as follows: In October 2024, the government made an initial payment of US$475.60 million, covering obligations due under the restructuring agreement, including the first post-restructuring debt service.

    “In January 2025, the government paid US$349.52 million. And, in July 2025, a further US$349.52 million has been paid. This brings Ghana fully up to date on all scheduled Eurobond debt service obligations for 2025”, the statement signed by the Finance Minister, Dr Cassiel Ato Forson read.

    “Looking ahead to 2026, a total debt service of US$1,409.06 million is scheduled.

    “This timely payment reaffirms Ghana’s commitment to macroeconomic stability, prudent debt management, and constructive engagement with external creditors.”

    The Ministry expects that, the timely honoring of the debt obligations will: “Positively influence Ghana’s credit ratings trajectory in the months ahead, as it demonstrates continued discipline in debt servicing post-restructuring; Boost investor confidence in Ghana’s sovereign credit profile and economic recovery program; and Support foreign exchange market stability, as it has been incorporated into the Bank of Ghana’s reserves and liquidity management strategy.”

     

    By Adnan Adams Mohammed

  • Gov’t prepares to honor US$1.4bn Eurobond debt servicing next year …as it completes 2025 obligations

    President John Mahama in a tit-a-tit with Dr Cassiel Ato Forson

     

    By Adnan Adams Mohammed

     

    The Government of Ghana as part of its Eurobond debt servicing obligations under the Debt Restructuring negotiations has made the last batch payment of US$349.52 million.

     

    This is bring the total of payment made towards Eurobond servicing since October 2024 to US$1,174.64 million.

     

    The Ministry of Finance in a statement released today gave the breakdown as follows: In October 2024, the government made an initial payment of US$475.60 million, covering obligations due under the restructuring agreement, including the first post-restructuring debt service.

     

    “In January 2025, the government paid US$349.52 million. And, in July 2025, a further US$349.52 million has been paid. This brings Ghana fully up to date on all scheduled Eurobond debt service obligations for 2025”, the statement signed by the Finance Minister, Dr Cassiel Ato Forson read.

     

    “Looking ahead to 2026, a total debt service of US$1,409.06 million is scheduled.

     

    “This timely payment reaffirms Ghana’s commitment to macroeconomic stability, prudent debt management, and constructive engagement with external creditors.”

     

    The Ministry expects that, the timely honoring of the debt obligations will:

    “Positively influence Ghana’s credit ratings trajectory in the months ahead, as it demonstrates continued discipline in debt servicing post-restructuring;

     

    “Boost investor confidence in Ghana’s sovereign credit profile and economic recovery programme; and

     

    “Support foreign exchange market stability, as it has been incorporated into the Bank of Ghana’s reserves and liquidity management strategy.”

     

     

  • Ghana classified at ‘high risk’ of debt distress…as total external liabilities stand at US$28.3bn

    Adnan Adams Mohammed

    Despite major success with its debt restructuring efforts, Ghana is still rated as a ‘high debt distressed” nation, according to the updated 2024 Debt Sustainability Analysis (DSA).

    The updated DSA is in line with the revised medium-term fiscal framework of the 2025 medium term budget framework and the third IMF Review macro-framework.

    The updated DSA assessed Ghana’s public debt distress in light of the macro-fiscal developments and agreements with the Official (bilateral and multilateral) Creditors and Eurobond holders. In evaluating the solvency and liquidity status of the public debt portfolio, the DSA considered current and future debt service obligations on Ghana’s debt dynamics over the medium to long-term.

    “Mr Speaker, the DSA assessment classified Ghana’s external and public debt risk rating as ‘high risk’ of debt distress”, Dr Casiel Ato Forson told parliament last week when presenting the 2025 budget.

    “The Present Value (PV) of the total debt-to-GDP ratio and the external debt service-to-revenue ratio remain elevated above DSA thresholds in the near-term but are expected to be within the landing zone by 2028.”

    Provisional data indicates that, Ghana’s gross central government and guaranteed debt as at end December 2024 stood at GH¢726.7 billion (US$49.4 billion) up from GH¢610 billion (US$52.4 billion) in 2023, representing, 61.8% of GDP in 2024 compared to 68.7% of GDP in 2023.

    “This reduction in debt-to-GDP ratio and the dollar component of our debt stock is as a result of the outcome of the Eurobond debt restructuring”, the Minister noted.

    The total public debt stock comprises external debt of GH¢416.8 billion (US$28.3 billion) and domestic debt of GH¢309.8 billion (US$21.1 billion). The external debt accounts for 57.4% of the total public debt stock, while domestic debt accounts for 42.6%. In terms of GDP, the external and the domestic debts account for 35.4% and 26.3%, respectively.

    Meanwhile, the government’s Medium-Term Debt Management Strategy (MTDS) for the period 2024-2027 as captured in the budget statement was developed in fulfilment of section 59 of the PFM Act.

    The MTDS for 2024 focused on the appropriate financing mix to mitigate costs and risks in the debt portfolio and sought to continue the government’s debt operations programme to promote debt sustainability while meeting financing needs.

    The strategy proposed issuances of treasury bills and re-opening of bonds on the domestic market to finance the 2024 Budget. It also proposed building cash buffers for debt and cash management purposes from domestic sources. The strategy further proposed external financing under the IMF-ECF programme and the World Bank DPO to support the 2024 Budget implementation.

    In line with the strategy, the government raised a total of GH¢41.5 billion (net issuance in government securities), 3.2% more than the revised net domestic financing target of GH¢40.2 billion. The additional borrowing was used to build buffers for debt operations. Government also received US$960.0 million from the IMF and US$300.0 million from the World Bank to support the implementation of the 2024 Budget.

    “Mr Speaker, as part of efforts to bring the debt levels to a sustainable path, a debt limit of US$231.5 million in present value terms was placed on non-concessional external
    borrowing. At end-December 2024, total new non-concessional debt of US$35.2 million in present value terms was contracted”, Dr Ato Forson noted.

    He further recounted that, “market conditions in 2024 adversely affected the cost and risk indicators of the public debt portfolio, particularly refinancing and interest rates risks of domestic debt. The weighted average interest rate for domestic debt increased from 13.7% (2023) to 16.2% (2024). The domestic debt portfolio showed Average Time to Maturity (ATM) of 4.8 years (2024) from 6.1 years (2023), under the refinancing risk. In terms of maturity profile, 38.0% of domestic debt will be maturing in 2025, which is explained by the high proportion of T-Bills issued during the year. This resulted in higher domestic short-term financing and posed a high refinancing risk on the debt portfolio.”

    Consequently, “following the restructuring of the Eurobonds, the weighted average interest rate reduced to 3.4% in 2024 from 5.3% in 2023. Also, about 85.4% of the debt portfolio is at a fixed interest rate compared to 92.1% in 2023”, he added.

     

     

  • Ghanaian pensioner Eurobond holders plead for exemption amid debt restructuring hardship

     

    Ghana’s Eurobond Debt

     

    A group of pensioner Eurobond holders in Ghana has expressed profound disappointment and frustration over government’s Eurobond debt restructuring plan, following recent remarks by the Finance Minister.

     

    The pensioners, feeling excluded from key negotiations, voiced their concerns after the Minister announced that Eurobond investors had forgiven USD5 billion of Ghana’s debt.

     

     

    The pensioners argue that while negotiations have focused on international and commercial bondholders, they have been left out of discussions, despite being significantly impacted by the restructuring.

     

    They contend that unlike larger institutional investors, they cannot bear the severe financial losses imposed by the government’s current debt restructuring plan.

     

    The restructuring involves a 37 per cent haircut, reduced interest rates, and extended maturity dates that stretch up to a decade. For the pensioners, these measures are devastating.

     

    The bonds, which they had relied upon for financial security during their retirement, are now at risk, particularly affecting their ability to cover essential expenses such as medical care.

     

    “We, the affected pensioners, write to express our deep disappointment and frustration with this turn of events,” the group said in a statement.

     

    It continued that: “At our age, and being on retirement, the 37 per cent haircut, reduced interest rates, and longer tenor will affect us adversely, resulting in significant financial losses which we can hardly afford.”

     

    For the past two years, these pensioners have endured zero interest payments on their bonds, exacerbating their financial hardship.

     

     

    Despite multiple letters and appeals to the Finance Ministry, they have yet to receive a response. Now, they are pleading for an exemption from the Eurobond restructuring plan, citing their vulnerability as retirees.

     

    Among their key requests are an exemption from the Eurobond restructuring for pensioners and other vulnerable groups and exploration of alternative solutions that protect their financial stability.

     

    The pensioners, though a small group, stress that their plea is reasonable given their limited resources and the harsh terms of the restructuring.

     

    They are urging the government to reconsider its stance and adopt a fairer approach that does not further compromise their financial wellbeing.

     

     

  • Eurobond restructuring signals confidence in economy – Akufo-Addo touts

    Ghana’s Eurobond Debt

     

    Adnan Adams Mohammed

     

    Ghana’s President, Nana Akufo-Addo, has touted recent agreement with Eurobond holders as a clear indication of renewed investor confidence in the country’s economy.

     

    The government, fortnight ago, announced success in securing almost 100% participation in the Eurobond Debt Exchange Programme, which concluded on 30th September 2024.

     

    The debt restructuring exercise, a key requirement under the International Monetary Fund (IMF) programme, was part of efforts to address Ghana’s growing debt burden and secure a US$3 billion bailout over three years.

     

    “The restructuring will be completed by next week, with bondholders exchanging their old bonds for new ones under revised terms. The new terms would allow Ghana more flexibility in repaying its debt”, President Akufo-Addo indicated during an interview with France 24, last week.

     

    He expressed optimism that the high level of participation, with 98.6% of bondholders agreeing to the deal, reflects growing confidence in Ghana’s economic recovery, particularly following the financial strain caused by the COVID-19 pandemic.

     

    He added that the agreement involves different interest rates and will significantly ease the financial burden on the country. “Thirteen billion dollars of our debt has been restructured, with $5 billion written off. In total, we’re talking about savings of around $10 billion, which is a major boost for the economy,” Akufo-Addo noted.

     

    He expressed optimism that improving macroeconomic indicators would soon lead to tangible economic development and better living standards for Ghanaians.

     

    As part of the restructuring deal, a significant number of bondholders opted for what is known as the “disco menu,” which involves a 37% reduction in the face value of their bonds and interest payments of 5% from 2024 to July 2028, rising to 6% thereafter. These investors will receive three new bond instruments in return.

     

    Others chose the “par menu,” which preserves the nominal value of their bonds but offers a lower interest rate of 1.5%, with the new bonds maturing in January 2037.

     

    According to a statement from the bondholders, this Eurobond Debt Exchange Programme is a crucial part of Ghana’s broader debt restructuring efforts under the IMF deal.

     

    The swap of old securities for new ones is expected to take place around 9 October 2024 with the entire settlement process finalised shortly afterwards.

     

     

  • Mould backs calls on gov’t to rebuild sinking funds 

    Mould backs calls on gov’t to rebuild sinking funds 

    Adnan Adams Mohammed

    A finance expert has backed the call by a former finance minister, Professor Kwesi Botchwey, on government to rebuild sinking funds to help in repayment of the country’s maturing Eurobond loans.

    The former Executive Director at Standard Chartered Bank, Alex Mould has said, currently the country is practising “cash accounting”, that is, “we pay as we go”. This is ok for steady payments but not good for intermittent large payments like EuroBond principal repayments.

    Ghana’s longest serving Finance Minister during a lecture on the economy at University of Ghana yesterday, March 7, 2022, cautioned current government to desist from collateralizing public revenue schemes among other policies that would further mortgage the future of the young generation. Noting that, for example, whoever takes the reins of government in 2025 will have to shed a whopping $1.5 billion in Eurobond principal payment within months of assuming office.

    “If we don’t rebuild sinking fund and we are unable to access international capital market to refinance our Eurobonds, then this could mean that the next government may default in its maturity Eurobond obligations in 2025”, Professor Botchwey said.

    Consequently, Mr Mould in his reaction to Prof Botchwey’s lecture affirmed that, “most governments don’t worry about the principal repayment because all they do is refinance it in the market that the bonds were originally issued.”

    The finance expert further noted that; in light of the country’s current economic predicament, “the Capital markets will be closed to us for a few years while we restore confidence in the inveators and get our credit rating up to levels that do not exclude some qualified investors from holding junk paper; and also, unless we are prepared to pay 13-14% interest rate,which is absurd and abnormal.

    “So we won’t go to refinance the chunk of debt maturing in 2025 in the Capital markets, and that’s why we have no other alternative than to rely on our bilateral and other financing from local banks, and also the reason we need to allocate some of our forex earnings from exports and remittances.”

    Mr Mould explained, “What this means is that, the forex available to market players will be reduced as we have we have to put some aside for the repayment of the principal that will become due especially in 2025.

    “And remember we shall have to buy this forex using cedis so government will be borrowing more cedis in the local capital markets and this will increase interest rates and also the exchange rate for Forex.”

    Meanwhile, Prof Botchwey, who proposed a number of wide-ranging measures to address the economic challenges confronting the country, said the current macro economic indicators, including the country’s debt to GDP ratio, inflation rate, drop in creditworthiness rankings, fast depreciation of the cedi against the US dollar, the rising cost of fuel among other indicators pointed to the fact that the nation was in economic crisis.

    “The crisis is here and if it is not resolved, it will lead to a catastrophe.” Prof. Botchwey, who served as Finance Secretary in the Military led Provisional National Defence Council (PNDC) Era as well as the Finance Minister during the National Democratic Congress civilian rule, all under late Jerry John Rawlings, said.