S&P says Ghana’s local debt in default, cuts foreign bonds

S&P said Ghana’s proposed local debt swap is a “distressed exchange offer,” earning those bonds the “selective default” rating, while the foreign currency bonds downgrade responds to the government’s announced plans to restructure that debt.

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S&P Global downgraded Ghana’s long-term local currency bonds to “selective default” and cut the country’s foreign currency debt to “CC” from “CCC-plus,” with default a “virtual certainty,” the ratings agency said in a Tuesday statement.

S&P said Ghana’s proposed local debt swap is a “distressed exchange offer,” earning those bonds the “selective default” rating, while the foreign currency bonds downgrade responds to the government’s announced plans to restructure that debt.

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Ghana’s parliament on Tuesday narrowly approved the proposed 2023 budget, overcoming resistance from opposition lawmakers over the inclusion of the debt exchange and a higher value-added tax. (Reporting by Rodrigo Campos and Marc Jones; Editing by Leslie Adler and Sandra Maler)

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Source: Reuters

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