The Finance Minister, Ken Ofori-Atta, has appealed to individual bondholders to accept the revised terms from the government to complete the Domestic Debt Exchange Programme (DDEP) and pave the way for the International Monetary Fund (IMF) programme.
The DDEP is a key requirement for the government to secure IMF Board approval.
Speaking to some protesting retired bondholders, Mr. Ofori-Atta said the five-year maturity on offer was favourable given a third of them held instruments with maturities of more than 12 years, despite an interest rate cut to 15% from an average of 18.5%.
He mentioned that the current term is the best the government can offer individual bondholders.
According to the government, those under the age of 59 are being offered a 10% coupon rate.
“Look into your heart and ask whether what has been offered is so injurious versus your contribution to our economy,” the Finance Minister told five of the protesters after a larger group had left their earlier demonstration.
“Hand on heart I feel (the deal offered) is good for you and good for the nation,” he added.
Ghana exempted pension funds from the broader debt exchange in December 2022 after widespread protest, contingent on labour groups agreeing an alternative solution with the government.
The protesting retirees said they also wanted to be left out of the debt exchange altogether.
“The minister has said they want 80% (of domestic bonds to be exchanged) to become successful,” said Adu Anane Antwi, convener of the Pensioner Bondholders Forum, which says it has 450 members.
“We think if pensioners are left out of the programme they will still get their 80%.”
Meanwhile, the Finance Minister said he expected “full tendering” from banks and other financial institutions that hold Ghana’s domestic bonds when the programme closes on February 7, 2023.
Ghana’s struggling economy needs a $3 billion bailout from the IMF in order to get back on its feet.
Source: Business Analyst