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(Bloomberg) — Ghana has formed a committee to start talks with its domestic bondholders as part of a plan to secure a potential $3 billion loan from the International Monetary Fund.
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The five-member committee will work with the financial services industry and other stakeholders to “provide industrywide inputs and transmit industry concerns on debt management strategy” to the policymakers, the Ministry of Finance said in a statement. “The expectations and goals are to ensure orderliness and confidence in the government’s negotiations with the IMF.”
Ghana started engaging with the IMF in July but only began formal negotiations for the extended credit facility program with the lender last month. Bloomberg reported in September that the state was poised to start discussions with domestic bondholders on a restructuring of its local-currency debt as part of the talks with the IMF.
Government debt increased to 402.4 billion cedis ($38 billion), or 68% of gross domestic product, by the end of July. Debt-service costs in the first half amounted to 20.5 billion cedis, equivalent to 68% of tax revenue, according to budget data.
The country plans to undertake a similar engagement with its external bondholders, the ministry said.
The committee is led by Albert Essien, a former chief executive officer of Ecobank Group, with Simon Dornoo, a former managing director of state-owned GCB Bank Ltd. is vice chairman. The other members are Alex Asiedu, Mabel Nyarkoa Porbley and Peter Enti.
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