All member countries of the G20 group of economic powers seem to be buying into the idea of restructuring Ghana’s debt, with the Paris Club, a group of officials from major creditor countries, taking the lead in setting up the aforementioned Committee of Creditors. Objective.
The next step follows Ghana’s request for debt restructuring under the G20 General Framework, a framework established to help low-income countries. Ghana’s application for debt restructuring under the G20 Common Framework came last week, making it the fourth country to do so after Chad, Ethiopia and Zambia.
The framework was created in 2020 following the global pandemic and allows for a streamlined process of coordinating creditor governments to restructure the debts of low-income countries.
An anonymous official of the Paris club was quoted as saying, “Leaders are committed to forming a committee of creditors, so it is a question of time. We know that all G20 members are committed to undertaking debt treatment under a common framework.
While previous instances took a couple of months to set up the committee, the Paris club hopes to assemble the committee within a month, the official noted.
“Based on past cases we hope the process will become smoother and smoother” The official said after noting that Ghana’s debt restructuring was less complex than Zambia’s case.
Ghana’s recovery path, a year after the worst economic downturn in 2 decades, looked promising last month.
It was recently reported that the country’s producer price index fell by 25.9% in December following the revaluation of the country’s currency against the dollar in the same month.
In the same month, Ghana introduced a debt swap programme, which was hailed as intuitive, and shortly afterwards secured a staff-level agreement with the International Monetary Fund for a $3bn relief fund.