S&P drops Ghana to SD

S&P said it lowered Ghana’s long-term foreign-currency sovereign credit rating to SD, selective default, from CC. The agency also affirmed the CC long-term foreign-currency issue-level ratings to reflect the understanding that, as of Dec. 20, Ghana remained current on the servicing of all its individual Eurobonds and commercial term loans.

“We lowered our foreign-currency sovereign credit rating on Ghana following the government's announcement on Dec. 19 that it will cease to make principal and interest payments on foreign currency foreign-law debt.

“We view the moratorium as a selective default under our criteria. Our understanding is that Ghana's authorities are in the process of proposing a restructuring of foreign currency commercial debt to its creditors. The suspension of foreign currency debt servicing comes on the back of the government's initiation of a transaction on Dec. 4 that we classify as a distressed exchange offer on the majority of Ghana's domestic local currency debt instruments,” S&P said in a press release.

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