Ghana secured a staff-level agreement with the International Monetary Fund for a $3 billion bailout, a key step in the West African nation’s plans to restructure its unsustainable debt.
The accord, which still requires IMF board
approval, enables the government to address its precarious public finances and support the cedi – the world’s worst-performing currency this year. Investor concerns about ballooning
government debt – forecast to exceed the size of its economy this year – led to a selloff of government bonds this year that effectively locked the country out of international capital.
The economic program aims to restore
macroeconomic stability and debt
sustainability while laying the foundation for stronger and more inclusive growth,” said IMF Ghana Mission Chief Stéphane Roudet.
The agreement is also subject to the receipt of the necessary financir assurances by Ghana partners and creditors, he said. The cedi traded 1.2% stronger at 12.15 per dollar by 9:08 a.m. in the Ghanaian capital, Accra.
The yield on Ghana’s benchmark 10-year eurobond dropped 32 basis points to 29.22%. 0.57% 10:34.