Failure of debt exchange poses high risk for obtaining IMF bailout - Joe Jackson

A financial analyst, Joe Jackson, has cast a gloomy look on Ghana’s quest to secure an IMF deal should the debt exchange programme fail.

The analyst explained that having debt sustainability is one of the requirements for securing a financial bailout from the International Monetary Fund.

However, since Ghana is currently a high-debt distressed country, it has become necessary to restructure and push the country’s debts back to unsustainable levels.

“If we don’t get this debt exchange programme through then we will not be able to achieve our debt sustainability, then the IMF programme will either be delayed or may even be at risk.

“Up until now, the markets have been treating us kindly because everybody’s assumption is that somewhere in February or March IMF is coming through. If we don’t achieve our debt right, if we have to stress them again then IMF will not come when it is due or back off and then, the chaotic debt reforms we are trying to prevent will now happen with all the dark consequences of not being able to access any funds anywhere,” he is quoted by 3news.com

Joe Jackson however asked the government to negotiate with bondholders to ensure that a consensus is reached.

“Take current requests from groups as an opportunity to engage quickly and use this opportunity to negotiate acceptable terms so that the domestic debt programme will go ahead if not as scheduled, at least at this month,” he said.

SSD/DA