Ghana’s dollar bonds rose on Monday after the country reached an agreement with its official creditors to restructure bilateral loans.
Debt maturing in 2035 rose 1.2 cents on the dollar to 43.97 as of 1:34 p.m. London time, trading above its 100-day moving average. Securities due 2027 gained 0.7 cent to the highest price since 21 September All of the country’s 14 bonds included in the Bloomberg EM Sovereign Total Return Index rallied.
After months of talks, the country struck a deal with the Paris Club of creditors and others, including China, to rework $5.4 billion of bilateral obligations, Minister of Finance Ken Ofori-Atta said late Friday.
Negotiated under the Group-of-20 Common Framework for Debt Treatment, the accord paves the way for the International Monetary Fund to make a second US$600 million disbursement under its US$3 billion bailout program to Ghana.
The IMF Executive Board is expected to meet by 19 January.
An approval would also unlock as much as US$550 million of additional funding from the World Bank, Ofori-Atta said.
Ghana, which received an initial US$600 million at the start of the IMF’s three-year program in May, must now reach a debt-restructuring deal with commercial creditors.
The halted payments on most of its external debt just over a year ago. In October, it proposed a principal reduction of as much as 40% for commercial creditors, including holders of US$13 billion of global bonds.
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