Ghana may struggle to borrow targeted $5bn in 2021, say analysts

By David Whitehouse
Posted on Thursday, 18 March 2021 17:13

Ghana's President Nana Addo Dankwa Akufo-Addo l
Ghana's President Nana Addo Dankwa Akufo-Addo in Accra, Ghana Thursday, 13 September, 2018. (AP Photo/Sunday Alamba)

Ghana may struggle to raise the full $5bn it wants to borrow from international markets this year given the scale of its debts, analysts say.

“Any eurobond issuance this year is likely to be below the targeted $5bn,” says Mark Bohlund, senior credit research analyst at REDD Intelligence in London. “Ghana’s severe fiscal and public debt challenges will be difficult to sugar-coat to potential investors.”

The International Monetary Fund (IMF) deemed Ghana at high risk of debt distress in April 2020. With interest costs at close to 50% of government revenue, Ghana is already over-indebted, says Bohlund. An IMF annual review planned for the third quarter could make support conditional on a restructuring of external and overall debt, he adds.