The United States Government has barred Ghana from receiving foreign assistance, including development loans and support under flagship programmes such as the Millennium Challenge Corporation (MCC), following Ghana’s failure to meet debt obligations to U.S. entities.
The restrictions are expected to take effect in the 2026 financial year.
A report submitted to the U.S. State Department said the decision was based on the “debt default restriction” under Section 7012 of the FY 2025 State, Foreign Operations, and Related Programs Appropriations Act.
Under the law, U.S. assistance is prohibited to countries that default on sovereign debt owed to, or guaranteed by, a U.S. person or specified official creditors, unless a debt restructuring agreement has been reached.
Both the MCC and the U.S. Department of State confirmed compliance with the law on August 6, 2025.
Two major defaults reportedly triggered the application of the restriction to Ghana. The first followed the Government of Ghana’s announcement on December 19, 2022, to suspend payments on most of its external public debt, including Eurobonds, commercial loans and a large portion of bilateral obligations. These debts are held by international creditors, including U.S. banks, asset managers and investment funds.
The second relates to an estimated US$251 million owed to U.S. companies, including Twin City Energy, American Tower Company, GSM, Chubb, Kosmos Energy and Zipline. Some of the obligations are backed by the U.S. Development Finance Corporation, raising concerns about exposure of U.S. public funds.
Chairman of the U.S. Senate Foreign Relations Committee, Mr James Risch, has previously drawn attention to the arrears, alleging that Ghana made payments to Chinese creditors while defaulting on U.S.-linked obligations. He has also called on Washington to press the International Monetary Fund to withhold further financing to Ghana.
The affected debts are reported to involve Government of Ghana institutions, particularly within the energy sector, and are being treated as state obligations rather than liabilities of private firms.
Ghanaian authorities have reportedly classified the arrears as part of an estimated US$2.6 billion in legacy debts in the energy sector.
