Finance Ministry to disburse GHS 1.5bn in bailout package to banking sector clean-up victims
President Nana Akufo-Addo has directed the Finance Ministry to disburse GHS 1.5 billion to customers affected by the banking sector clean-up.
This adds up to the already GHS 25bn spent by the Government in the banking sector clean-up exercise which took place in 2017.
The directive by the President was revealed by Finance Minister Dr. Mohammed Amin Adam over the weekend during a UK Town Hall meeting, where Dr. Amin Adam emphasized the urgency of the disbursement, which is to be completed between June and October.
Highlighting the government’s commitment to the welfare of the populace, Dr. Amin Adam stated, “Ideally, the government should not be held responsible for the investment decisions of individuals, but this government is so caring. Mistakes were made, and people were not well-informed. We know that those affected are suffering, with some cases resulting in death and suicide.”
“This government is so caring that we initially granted a bailout to all those affected. Now, the President has directed another bailout of GHS 1.5 billion to be released between now and October,” he added.
Meanwhile, Dr. Amin Adam has disclosed the successful completion of Ghana’s debt restructuring program with its creditors. The government has effectively restructured $5.1 billion in debt with these creditors and concluded the restructuring of $13.1 billion with Eurobond holders.
Addressing the attendees, Dr. Amin Adam underscored the significance of these negotiations, which resulted in $8 billion in savings for the country.
“Two weeks ago, we finalized negotiations with official creditors, restructuring $5.1 billion and securing $2 billion in savings. We have now also concluded negotiations with Eurobond holders on $13.1 billion, yielding a favorable deal for Ghana,” he stated.
These restructuring efforts are part of a broader strategy to meet IMF targets, including reducing the debt-to-GDP ratio to 55% by 2028 from a projected 109% before the restructuring began.
Ghana’s economy outperformed expectations, expanding by 2.9% in 2023 compared to the IMF’s initial forecast of 1.5%, supporting a revised Debt Sustainability Analysis (DSA) accommodating the new bondholder agreement.
Ghana began its debt restructuring over a year ago as part of an agreement with the IMF. The process included an agreement in principle with bilateral creditors under the G20 Common Framework for Debt Treatment, setting the stage for the successful restructuring of its Eurobond debt.
