Bright Simons, the Vice President of IMANI, has called into questions on government’s announcement of over 85 percent of eligible local bondholders signing up for the Domestic Debt Exchange programme (DDEP).

Mr. Simons disclosed his curiosity about how 35 percent of bondholders signed on within a 24-hour duration citing ‘customized’ calculations on the part of government to suit the high final participation rate of 85 percent.

“So, the government of Ghana has decided to choose its own arbitrary number for tendered outstanding principal & declared an 80%+ participation rate. Great!
“So, that means maximum DEBT RELIEF. Creditors want no stories going forward about debt service. We will all see by mid-year budget.”
Bright Simon

Commenting on government’s discrepancies, Bright Simons explained how government through its consultants adjusted the matrix for calculating the participation rate to allow it arrive at a higher participation rate.

“I see that government of Ghana has been getting full worth from those high end consultants from Lazard. As soon as they saw resistance, they began to adjust the principal of outstanding debt to ensure the right participation rate. From GHS137bn to GHS130bn to GHS97bn.”
Bright Simons

Most analysts, according the Vice President of IMANI, had pegged the highest rate government could arrive at was between 60 to 63 percent but the adjustments made a higher rate possible.

“So essentially, if you use any of the old outstanding principal numbers (focus only on the grand total at the bottom), you get 60% to 63% participation rate, as per analysts’ projections. But who cares at this point?”
Bright Simons

How Can You Do This And Celebrate As Success? – Mr. Adongo Questions Gov’t

Just as the Vice President of IMANI Africa has questioned the Government on certain suspicious dubious act surrounding the debt exchange program, the deputy ranking member of the finance committee, Mr. Isaac Adongo has questioned the government of the exchange program.

The deputy ranking member has condemned the government for willing to give out $10billion bondholders’ money for $3billion IMF bailout.

This comment comes after the finance minister in a press statement disclosed that the government has secured more than the needed 80% participation in the DDEP as part of the key steps to reach board-level approval with the International Monetary Fund (IMF), on a $3 billion facility to restore macroeconomic stability in the country.

Speaking during an interview, Mr. Isaac Adongo averred that the government from its statement is instructing individuals to forgo their money so that they can achieve compliance with the internal arrangement of the IMF.

“Government is doing all this so they can get a program that gives us $3 billion. And yet the people’s money that you want to use to sacrifice is over $10billion. So, you want to destroy $10billion in order to go and collect $ 3 billion dollars over three years not even one year.
“These are people’s monies, these are not the government of Ghana money, these are pensioners’ monies. And these are monies they gave to you on the trust of the sovereign. Now the government says we want to take your money, we won’t give you the money because the economy is in trouble.”
Mr. Isaac Adongo

According to the deputy ranking member, the government communicated in its budget it has 52 billion of interest payment. “31billion of that is attributable to Ghanaians bondholders for payment on matured bonds in 2023, but government discloses it is not going to pay holders that money, hence, zero payment,” he said.

Mr. Adongo in expressing his disappointment questioned the government if it has taken its initiatives into considerations, especially looking at how its citizens will be affected.

“You have extended 21billion that you have to pay to external creditors. You have written a letter to them suspending payment that you are not going to pay. So, in all, you aim to achieve debt sustainability and be able to qualify for the IMF program in 2023 alone whilst you have 74billion of debt service you are not paying. How can you do this and celebrate as success?”
Mr. Isaac Adongo