Ghana saves $2.86bn in debt service relief as it secures final MoU with Official Creditors

The Government of Ghana has formalized a crucial debt treatment agreement with its Official Creditors Committee (OCC) by signing a Memorandum of Understanding (MoU), a significant step towards restoring long-term debt sustainability.

The agreement, co-chaired by China and France, was disclosed in a statement from the Ministry of Finance dated January 29, 2025. This milestone comes after Ghana, in December 2022, suspended portions of its external debt servicing to commercial and bilateral lenders amid a deep economic crisis.

At the time, inflation had soared to a staggering 54%, while international reserves had plunged to less than two months of import cover. The nation embarked on a comprehensive debt restructuring journey, including the successful completion of its Domestic Debt Exchange Programme (DDEP) in 2023.

A year ago, on January 12, 2024, Ghana reached an agreement with its Official Creditors under the G20 Common Framework for Debt Treatments, going beyond the Debt Service Suspension Initiative (DSSI). However, it has taken another year to finalize and formalize the terms through the MoU.

“With the MoU now signed, the agreed terms will be implemented through bilateral agreements with each OCC member,” the Finance Ministry’s statement confirmed. According to the International Monetary Fund’s December 2024 report, Ghana is set to benefit from a substantial debt servicing relief of approximately $2.86 billion. Of this amount, an estimated $657 million is expected to be realized within 2025, providing much-needed fiscal space for economic recovery.