[ 2015-04-23 ]

Gov’t Seeks US$400m More Debt
The Bank of Ghana will tomorrow auction
government’s 3-year bond to raise US$400million
for restructuring maturing debts and also for
liquidity management.

This will be the second three-year bond to be
issued this year, following an earlier one of
GH¢630million issued in February.

The new auction is part of government’s earlier
plans to borrow about GH¢25.42billion from the
domestic market within the first six months of
this year, which is twice what the state borrowed
from the market in the same period last year.

Already, government has since the beginning of the
year raised about GH¢16.3billion through the
issuance of various Government of Ghana
securities.

The last time government entered the domestic bond
market, to raise GH¢974million through the sale
of its 5-year bonds, it was oversubscribed to
affirm investors continued confidence in the
economy despite economic challenges and fears that
the country’s debt situation is fast nearing
unsustainable level.

Various credit rating agencies, Fitch and
Moody’s, in their latest assessment of the
economy cut Ghana’s credit ratings outlook on
fears of deteriorating currency and debt trends,
with the debt-to-GDP ratio jumping from 54.8% in
2013 to 67.2% at the end of 2014.

However, the recent approval of Ghana’s
three-year budgetary support programme with the
IMF earlier this month is expected to further
enhance investor confidence in the economy.

Source - Bus & Fin Times

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