(Recasts, adds details throughout)
By Christian Akorlie
ACCRA, Feb 14 (Reuters) - Ghana's finance ministry on
Tuesday said that around 85% of eligible bondholders had
registered for its domestic debt exchange programme, bringing it
one step closer to securing a $3 billion International Monetary
Fund (IMF) bailout.
The announcement followed five extensions of the scheme's
deadline, as the West African nation fought to secure its
targeted 80% subscription rate. Holdouts persisted despite
several revisions to the initial debt-swap offer.
Ghana is fighting its way out of a generational economic
crisis by hiking interest rates at record speeds, cutting
spending, and restructuring its debt as a condition to obtain
support approval from the IMF's Executive Board.
The ministry said on Tuesday that 84.91% of 97.7 billion
cedis of "eligible" domestic bonds were tendered and accepted.
It also extended the settlement date of the exchange to Feb.
21 from a previously announced Feb. 14 to "provide sufficient
time to settle the new bonds in an efficient manner".
The government had initially earmarked 126.97 billion cedis
($10.67 billion) of domestic bonds for restructuring, but agreed
to exempt pension funds in late December after labour unions
threatened a general strike.
"The government is ... grateful for the overwhelming
participation of all bondholders. Your support and contributions
have gotten your country much closer to securing the IMF
programme," it said in a previous statement issued in the early
hours of Tuesday.
"The alternative of not executing the DDEP would have
brought grave disorder in the servicing of our national debt and
exacerbated the current economic crisis."
Reaching the threshold should allow the government to settle
the exchange and move on, said Stuart Culverhouse, chief
economist at Tellimer.
However, with the exchange offer having undergone a number
of modifications throughout several extensions, the final terms
and the fiscal impact were as yet unclear, he added.
"Attention will now turn to the eurobonds, where
restructuring talks are at a much earlier stage, and which could
be even more complicated," Culverhouse said.
At the end of November, a third of Ghana's 575.7 billion
cedi ($48.4 billion) debt was domestic, according to the central
bank, while external debt was $29.2 billion.
Overseas bonds were trading slightly positive after the
news, with most around or below the 40 cents in the dollar
threshold. .
Ghana became early this year the fourth nation to apply to
the common framework platform, an initiative of Group of 20
major economies launched in 2020 to streamline debt
restructuring efforts for poorer countries.
Its bilateral lenders are discussing the formation of an
official creditor committee, a first step needed to engage in
debt relief talks, sources told Reuters on Monday.
($1 = 11.9000 Ghanian cedi)
(Reporting by Christian Akorlie in Accra and Jorgelina do
Rosario in London;
Writing by Alessandra Prentice, Sofia Christensen and Rachel
Savage;
Editing by Jacqueline Wong, Kim Coghill, Cooper Inveen, William
Maclean)
