The African Export-Import Bank (Afreximbank) has settled a dispute with Ghana over a $750 million loan, though it didn’t disclose if it would take losses.
Issues surrounding the facility signed in 2022 were resolved “to the satisfaction of both parties”, the Cairo-based lender said in a statement posted on its website Thursday, without providing details on the terms reached.
The standoff emerged after Ghana secured a bailout from the International Monetary Fund and took steps to restructure its debt following a 2022 default.
Africa’s top gold producer renegotiated more favorable terms on $13 billion of, $5.1 billion of bilateral loans and more than 200 billion cedis ($18 billion) of domestic debt, as part of the debt-restructuring exercise.
When Ghana sought to rework the Afreximbank facility, the multilateral lender argued that its “preferred creditor status” meant it shouldn’t have to accept losses.
This impasse, and a similar one with Zambia – which also moved to reduce its debt by seeking softer repayment terms – prompted Fitch Ratings to downgrade the bank’s long-term debt by one notch to BBB- in June.
Moody’s followed with a downgrade soon after, increasing the bank’s cost of borrowing.
Resolving the impasse will enable “both parties to continue to partner for Ghana’s development agenda”, Afreximbank said in the statement.
BLOOMBERG