Ghana's sovereign debt default

Ghana entered 2022 already carrying a heavy debt burden built up over years of borrowing to fund infrastructure and social spending, and the year's global shocks — rising interest rates worldwide, a strong US dollar, and the war in Ukraine's effect on food and fuel prices — pushed that burden past what the economy could sustain. The Ghanaian cedi lost roughly half its value against the US dollar during 2022, and inflation exceeded 50% by year-end, while credit downgrades from Fitch, Moody's and S&P progressively shut the country out of international capital markets. On December 19, 2022, Ghana's finance ministry announced it would halt servicing most of its Eurobonds, commercial loans, and bilateral debt as an emergency measure while it pursued an IMF program and a broader restructuring, one of the highest-profile sovereign defaults of the post-pandemic emerging-market debt cycle. The IMF approved a $3 billion Extended Credit Facility in May 2023, and Ghana launched a domestic debt exchange program alongside separate negotiations with Eurobond holders that eventually restructured roughly $13 billion in bonds with losses for creditors.