GOVERNMENT through the Bank of Ghana (BoG) between August and September 2016 increased their borrowing streak to GH¢603.09 million.
This was made up of one 3-year bond, one 2-year note and two 1-year notes.
According to a circular from the Ghana Stock Exchange (GSE),GH¢184.3 million was accepted for both 1-year notes, whilst GH¢104.5 million and GH¢314.17 million was accepted for the 2-year note and 3-year bond respectively.
While the two 1-year notes were issued on September 5 and September 19, 2016; the 2-year note and 3-year bond were both issued on September 12, 2016.
The yield for investors was 23.50 percent for the two 1-year note and 24 per cent for both the 2-year note and 3-year bond.
The fixed income securities were opened to both resident Ghanaians and nonresident Ghanaians. Expectedly, the interest payments will be done every half year till maturity.
The financial instruments have already been listed on the GSE.
It is however unclear whether some of the funds were used to settle maturing debts or were raised mainly for capital expenditure.
Ghana’s debt, according to the BoG, stood at about GH¢109.8 billion as at July this year, approximately 65.9 per cent of GDP. This was made up of an external debt amounting to GH¢60.6 billion and a domestic debt of GH¢49.2 billion.
With the exception of September, Ghana‘s debt has been increasing, crossing GH¢1 billion month on month.
In January 2016, Ghana’s total debt stood at GH¢101.1 billion; it increased to GH¢102.3 billion in February, and then to GH¢103.1 billion in March.
Ratings agency, Moody’s recently rated the Ghanaian Economy B3 – signaling stability from negative outlook. The key drivers of the rating, the agency said were driven by “significant fiscal deficit reduction and institutional reform implementation over the past year under the umbrella of the 3-year IMF programme starting April 2015.
It said it would consider a negative outlook in case of unanticipated and significant expenditure overruns which would halt or reverse the fiscal and external consolidation progress achieved thus far.
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