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Debt exchange programme will boost confidence in Ghana’s economy – BoG Boss

The Governor of the Bank of Ghana, Dr Ernest Addison says he is optimistic that the proposed Debt Exchange Programme announced by the government will bring back confidence in the economy.

Speaking at the Annual Dinner of the Chartered Institute of Bankers, Ghana, Dr Addison indicated that the programme will also enhance the efforts of the Central Bank in controlling inflation.

He observed the economic challenges which have affected many banks have led to the high cost of borrowing and doing business.

Dr Addison also assured of the Central Bank’s support to financial institutions to provide them with additional liquidity during the exercise.

“In addition to the near-term adoption of the IMF programme, we will provide a balance of payment support to help with financing gaps, boost investor confidence and restore stability, ” he stated.

Debt Exchange programme

The debt exchange programme include some exemptions and external debt restructuring parameters that will be implemented.

Finance Minister Ken Ofori-Atta said treasury bills and individual bondholders will not be affected by this exercise.

Domestic bondholders will be compelled to exchange their instruments for new ones.

“Existing domestic bonds as of December 1, 2022, will be exchanged for a set of four new bonds maturing in 2027, 2029, 2032 and 2037,” Ofori-Atta said.

He added that, “the annual coupon on all of these new bonds will be set at 0% in 2023, 5% in 2024 and 10% in 2025 until maturity.

Finance Minister Ken Ofori-Atta assured that government will ensure that people’s investments are safe.

Minority Kicks Against The Programme

The Minority in Parliament has vowed not to accept government’s proposed debt restructuring programme.

The Minority, led by Haruna Idrissu, believes the policy is unacceptable and cannot be allowed to proceed.

At a press conference on Monday, the Minority Leader, Haruna Idrissu, said his side will use every legitimate means to oppose the debt restructuring the government has proposed.

“Let me state without any fear of contradiction that the form and structure of the debt restructuring announced by Finance Minister Ken Ofori-Atta this morning are unacceptable to us and we simply will not accept it,” the Tamale South MP said.

Mr Idrissu wondered why the 2023 budget was silent on the debt structuring policy.

“I want to ask how come this debt restructuring was not included in the 2023 budget.”

 

Source: Myxyzonline.com

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