Debt cancellation: Ghana’s engagement with China postponed to March

The Finance Minister, Ken Ofori-Atta, has disclosed that government’s planned high-level meeting with Chinese creditors over Ghana’s debt restructuring has been postponed to late March 2023.

According to him, this is due to the upcoming National People’s Congress of China which is scheduled for early March.

However, bilateral talks will continue ahead of this important mission, Citi News sources have gathered.

Earlier this week, the Finance Minister, Ken Ofori-Atta, announced that he was due to meet representatives of the Chinese government and its quasi agencies in Beijing from February 26 on how they could support the Ghana with softer debt repayment terms.

This is part of measures by the team of negotiators to ask the country’s external creditors to allow for interest payment suspension for the public debt stock to come under sustainable levels.

For many stakeholders, this could affect Ghana’s timelines for an economic bailout of $3 billion to build back the economy as the country needs to conclude its debt restructuring negotiations with its creditors to be able to secure an Executive Board approval for the programme.

The government is seeking under the G20 Common Framework for Debt Treatment to get debt forgiveness from some bilateral and multilateral partners.

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 Paris Club members.