Paris Club to restructure Ghana’s debt

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All members of the G20 group of economic power have agreed to restructure Ghana’s debt and are ready to begin the process of forming a creditor committee.

According to a representative from the Paris Club, there is a commitment by the leaders to form the creditor committee, so it’s a question of time. We know that all the G20 members are committed to undertaking debt treatment under the Common Framework.

Last week, Ghana became the fourth nation, following Zambia, Ethiopia, and Chad, to request a debt restructuring under the G20 Common Framework, which was introduced in 2020 as a way to simplify the restructuring process for low-income countries following the pandemic.

The Paris Club official stated that Ghana’s case is less complex than Zambia’s, which has been struggling since becoming the first African nation to default after the outbreak.

The official also said that Ghana’s authorities have requested a “timely manner” for the restructuring process.

It typically takes a few months to form a creditor committee, but the Paris Club representative stated that all members are ready to do so for Ghana and it could be completed in a month.

However, progress in previous cases has been slow, partly due to China, a G20 creditor that is not a member of the Paris Club, but has become a significant lender.

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Joseph Omoniyi

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