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The Ghanaian Government has Essentially Filed for Bankruptcy

According to a report by The New York Times, President Nana Akufo-Addo’s administration “had no choice but to agree to a $3 billion loan from the lender of last resort, the International Monetary Fund,” which helped to explain Ghana’s financial crisis, in which government organisations owed billions to contractors and were in serious debt. The media outlet noted that the financial crisis has had far-reaching effects, with many contractors laying off workers, exacerbating the country’s unemployment problem. Emmanuel Cherry, the chief executive of an association of Ghanaian construction companies, recently disclosed that government back payments to contractors amounted to roughly $1.3 billion, before interest. The reports also disclosed that the Ghanaian government owes independent power producers $1.58 billion and is in danger of experiencing widespread blackouts. “The government is essentially bankrupt. It was the 17th time Ghana has been compelled to turn to the fund since it gained independence in 1957.” The IMF presented a comprehensive rescue plan to address Ghana’s debt, reining spending, increasing revenue, and protecting the most vulnerable populations while negotiating with foreign creditors.