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Ghana’s Deputy Finance Minister, Thomas Nyarko Ampem, has indicated there’s been tangible progress on the ongoing debt restructuring discussions with Afreximbank. Speaking after the Afreximbank shareholders’ meeting in Abuja—where George Elombi was elected as the new President and Chairman—Ampem emphasized that active talks are underway with stakeholders, and the government remains committed to finding a resolution. He also noted that airing these issues in the media isn’t particularly productive at this stage and that updates would be forthcoming.
For context, Afreximbank extended $750 million to Ghana back in July 2022, aimed at supporting capital expenditure, shoring up the local currency, and funding infrastructure projects like the Ofankor-Nsawam Road. This was part of a broader $1 billion financing effort, necessitated by limited access to capital markets following credit rating downgrades and the economic fallout from COVID-19.
The current challenge centers on whether Ghana should include debts owed to Afreximbank in its commercial debt restructuring. The government maintains that, according to agreements with the IMF and World Bank’s official creditor committee, Afreximbank does not qualify as a multilateral lender and should not be exempt. Afreximbank, on the other hand, insists it is a multilateral institution, and its loans should not be restructured alongside commercial debt.
This disagreement hasn’t gone unnoticed—Fitch recently downgraded Afreximbank’s credit rating to just above junk status, citing the restructuring uncertainty as a factor, a view echoed in recent analysis from JP Morgan.
Nevertheless, officials at the Abuja meetings have reiterated that progress is being made. There was a significant meeting aimed at moving these negotiations forward, and reports suggest some headway has been achieved, though key issues remain unresolved.
Some analysts are concerned about the potential implications for Ghana’s broader debt restructuring program if the Ministry of Finance concedes to Afreximbank’s demands. It’s worth noting Afreximbank has been a substantial financial partner to Ghana over the years, with a project portfolio exceeding $2 billion. The outcome of these negotiations will likely have a significant impact on both parties moving forward.