Aside from reducing its debt obligations, it is emerging that the swift payment of Ghana’s debt has far-reaching implications for the government’s quest to stage a return to both domestic and international capital markets.
Economist at Pentecost University, Dr. Paul Appiah Konadu, says the country’s latest Eurobond debt servicing marks a positive signal that could unlock Ghana’s re-entry into the capital markets.
For him, the timely and successful payment of maturing restructured Eurobond debts, under the debt restructuring programme, could serve as a powerful “gate opener” to regaining the trust of investors.
He tells The High Street Journal that “Our ability to service the existing debts will serve as a gate opener or leverage,” Dr. Konadu said adding that because once we are able to service the existing debts, then there is that confidence among investors that even if they buy new bonds, we will be able to service them in the future.
Ghana has been locked out of the international capital markets since 2022, after rising debt, inflation, and currency depreciation triggered a crisis that forced the country into a $3 billion IMF program.
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As part of debt restructuring efforts, the government halted new borrowing from external markets and focused on fiscal reforms.
Talks have begun already under the new administration to return to the international and domestic bond markets. Some analysts are apprehensive about the return, indicating that the country is not “credit worthy” to stage a comeback.
However, Dr. Paul Appiah Konadu believes the recent actions of Ghana to make payments without difficulty could be a signal that the country means business and that provisions have been made to honour future debts.
“Once we are able to service the existing debts, then there is that confidence among investors that even if they buy new bonds, you will be able to service them in the future. And that may pave the way for governments to reintroduce the bond markets, both domestic and maybe by the close of 2025, our re-entry into the international bond markets owing to the positive signals from our ability to service the existing restructured euro bonds and other external debts that governments are committed to,” he stated.
To the average Ghanaian, bond markets may sound abstract, but their impact is real. They influence critical economic indicators such as interest rates on loans and mortgage costs. It also influences the availability of funds for infrastructure projects, and critically, the stability of the cedi. It also plays a major role in investor confidence and job creation
Without access to affordable borrowing, governments struggle to invest in roads, energy, education, and social programs. That’s why a successful return to the markets is so critical.
Dr. Konadu believes that if this trend of responsible debt servicing continues, Ghana could reintroduce domestic bonds sooner and even re-enter the international bond markets by the close of 2025.
The economist is of the firm belief that Ghana’s recent payment is not just about meeting deadlines, it’s about rebuilding trust with the very institutions and investors the country depends on.
