Government rules out compensation for DDEP bondholders
The Government has ruled out any form of compensation for bondholders who suffered losses under the Domestic Debt Exchange Programme (DDEP), according to the Minister for Finance, Dr Cassiel Ato Forson.
Speaking at a joint press briefing in Accra on Friday to announce the completion of Ghana’s US$3 billion International Monetary Fund (IMF)-supported programme, Dr Forson acknowledged the hardships endured by investors and the public during the debt restructuring exercise but stated that there was no agreement requiring the State to reimburse affected bondholders.
He described the 2022 economic crisis as “very traumatic for the Ghanaian people” and stressed that the debt restructuring was necessary to restore economic stability.
“I do not recall that there is something of the sort that calls on the people of Ghana for the Ghanaian government to give some form of compensation. I do not know the details of an agreement that was signed between those who suffered, unfortunately, loss of investment,” the Finance Minister said in response to a question from the Ghana News Agency.
Dr Forson added that he was unaware of any legal or contractual clause in agreements signed with bondholders that would impose compensation obligations on the government.
“So we do not have any certain liability on us based on what was agreed to,” he stated.
Ghana entered the IMF programme at a time when the country’s total public debt had risen to US$63 billion, representing approximately 88 per cent of Gross Domestic Product (GDP) by the end of 2022.
As part of efforts to restore debt sustainability, the government restructured about GH¢137 billion in domestic bonds under the DDEP, with more than 95 per cent participation from bondholders.
The restructuring exercise involved adjustments to bond maturities and coupon rates affecting corporate investors, individuals, and pension funds, while the Bank of Ghana absorbed significant losses to help stabilise the financial system.
According to government, the reforms contributed to a reduction in public debt to 56.6 per cent of GDP by the end of 2024. The country also recorded a 1.7 per cent primary surplus, rebuilt international reserves to US$6.7 billion, and reduced inflation to 3.4 per cent in April 2026 from a peak of 54.1 per cent under the IMF Extended Credit Facility (ECF) programme.
Despite ruling out compensation, Dr Forson assured Ghanaians that government remained committed to maintaining fiscal discipline and using the fiscal space created by the reforms to support economic growth and job creation.
He announced that government would soon unveil a flagship programme dubbed “The New Economy,” which would target sectors with high employment potential, supported by a three-year non-financial technical assistance programme from the IMF.
Meanwhile, the IMF Mission Chief for Ghana, Ruben Atoyan, defended the debt restructuring programme, describing it as necessary to stabilise the economy and place Ghana on a sustainable path.
He noted that the restructuring had created fiscal space for growth and contributed to the sharp decline in public debt levels.
Mr Atoyan said the focus going forward would be on maintaining fiscal discipline, building reserve buffers from gold revenues, and managing risks associated with state-owned enterprises and quasi-fiscal activities.
The IMF official added that the new Policy Coordination Instrument (PCI), which will replace the Extended Credit Facility arrangement, would prioritise safeguards against contingent liabilities and fiscal risks outside the central government.
Comments (0)