According to reports from Bloomberg, the African Export-Import Bank (Afreximbank) has agreed to take losses on a $750 million loan to Ghana, ending a tense standoff that threatened to derail the nation’s massive economic recovery plan.
The resolution, confirmed by people with direct knowledge of the matter, represents a rare concession from the Cairo-based multilateral lender.
For months, Afreximbank had resisted the haircut, citing its “preferred creditor status”—a designation usually reserved for institutions like the IMF and World Bank that shields them from losses when a country defaults.
The compromise, reached just as the year draws to a close, marks a pivotal moment for Ghana as it seeks to emerge from its worst economic crisis in a generation.
The Price of a Breakthrough
While a joint statement released on Christmas Day by Ghana’s Finance Ministry and Afreximbank described the settlement as being to the “satisfaction of both parties,” it remained conspicuously silent on the specifics.
However, sources indicate that Afreximbank ultimately yielded to the “comparability of treatment” rules demanded by Ghana’s other creditors.
Under the Group of 20 Common Framework, official bilateral creditors and private bondholders typically insist that all lenders share the pain of debt relief proportionally.
By accepting terms set by an official creditor committee, Afreximbank will incur losses, though the exact magnitude of the write-down has not been disclosed.
A High-Stakes Gamble for Credit Ratings
For Ghana, the deal is a victory. It clears a major hurdle in its effort to restructure more than $30 billion in external debt, a process triggered by its 2022 default.
Without this settlement, previous agreements with Eurobond holders and foreign governments remained on shaky ground.
But for Afreximbank, the move carries significant risk.
The bank’s refusal to budge earlier this year was partly a defensive crouch to protect its creditworthiness.
Both Fitch Ratings and Moody’s have already penalized the lender for its exposure to the Ghanaian dispute.
In June, Fitch downgraded the bank’s long-term debt rating to BBB-, citing concerns that a haircut would undermine the bank’s business model.
Moody’s followed suit, a move that has already increased the bank’s own borrowing costs on international markets.
Timeline: Ghana’s Path to Restructuring
| Date | Event |
| 2022 | Ghana signs the $750 million facility with Afreximbank after being locked out of capital markets. |
| Dec 2022 | Ghana formally defaults on most of its external debt. |
| June 2024 | Fitch downgrades Afreximbank to BBB-, citing the Ghana standoff. |
| Dec 25, 2024 | Ghana and Afreximbank announce a “satisfactory” resolution. |
The Road Ahead
The $750 million loan was originally a lifeline. Signed in 2022, the facility supported the national budget at a time when investors were fleeing Ghanaian assets.
Now, the resolution allows the current administration in Accra to move forward with its IMF-backed reform program.
However, the precedent set by Afreximbank—a regional multilateral lender accepting losses—may ripple across the continent, potentially changing how other struggling African nations negotiate with similar institutions in the future.
For now, the focus shifts to how credit agencies will react to the finalized terms and whether the bank can maintain its standing as a stable bridge for African trade finance.
Source: Bloomberg
This article was edited with AI and reviewed by human editors
