Home  >>  Out of Rwanda >> 

Ghana is at High Risk of Debt Distress and will Struggle to Meet Financing Costs, IMF

The IMF has expressed renewed concerns over Ghana’s deteriorating debt situation.

International Monitory Fund-Ghana.

According to the Fund, “Ghana is at high risk of debt distress and faces exceptionally high gross financing needs”.

In an exclusive email conversation with Business Finder, the fund recommended a change in the country’s borrowing strategy, to consider changing market conditions when assessing alternative debt instruments.

An IMF spokesperson pointed out that to support government’s aim at a primary surplus for 2016 which is set to bring the debt to a downward trajectory, the fiscal deficit will also need to be financed at the lower cost, taking due account of the risks.

The Fund reminded government that “recently, yields on Ghana’s Euro-bonds have increased to above double digits, making this borrowing option very expensive.”

This warning is timely as government prepares to go to another road show in April this year to convince investors to subscribe to its fifth Euro-bond.

Ghana earned an astronomical 10.75% yield on the fourth Euro-bond issued last year for $1 billion, a move that was criticized by analysts as too expensive.

By Robert Muriisa.

Follow Us on Facebook and Twitter

Leave your comment

Your Name

Your Email

Your comment

Close X