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Ghana raises 208 mln USD in five-year domestic bond

Xinhua, June 25, 2016 Adjust font size:

Ghana successful raised here on Thursday 811.04 million Ghana cedis or 208 million U.S. dollars in a five-year domestic bond issued by the Bank of Ghana.

The bond, with a yield of 24.5 percent, will be used in restructuring some of its public debts which are mostly in the short term.

The last time Ghana issued a bond was in March 2016, at a yield of 24.75 percent.

The government seeks to enter the Eurobond market later this year to raise a total of 10 billion dollars, while issuing a combination of short and medium-term domestic debt instruments to the tune of the equivalence of 4.28 billion dollars.

The government will spend 3.79 billion dollars to restructure maturing debts.

The current bond arranged through bookmaking was led by book-builders, including Barclays Bank, Stanbic Bank, and Strategic African Securities (SSA).

Fiscal prudence is one of the requirements for Ghana in its three-year Extended Credit Facility with the International Monetary Fund (IMF).

But a drop in oil prices, coupled with increasing public sector wage demands, have made it quite difficult for the government in its determination to ensure fiscal discipline.

Election year pressure is also expected to push government to make more expenditure. Enditem