The government of Ghana, under the leadership of President John Dramani Mahama, has fulfilled its financial obligations to bondholders under the Domestic Debt Exchange Programme (DDEP), making significant payments while also setting aside funds to manage future debt obligations.
The President Spokesperson Hon. Felix Kwakye Ofosu, in a statement, noted that the move aimed at restoring investor confidence and enhancing debt sustainability.
According to him, the Ministry of Finance, following the President’s directive, has successfully settled a Payment-In-Cash (PIC) coupon of GHS6.081 billion to all DDEP bondholders.
Additionally, the government has honoured the Payment-In-Kind (PIK) portion of GHS3.46 billion, which has been credited to the respective bondholders’ securities accounts in accordance with the DDEP Memorandum.
To further bolster debt management efforts, the government has also deposited GHS9.7 billion into the Debt Service Recovery Cedi Account, commonly referred to as the Sinking Fund.
This allocation serves as a buffer for the fifth DDEP coupon, which will mature in July and August 2025. Hon. Kwakye Ofosu further reiterated President Mahama’s administration’s commitment to meeting all financial obligations under the DDEP framework.
In the official statement released by Hon. Felix Kwakye Ofosu, who doubles as the Minister for Government Communications, the government emphasized its determination to rebuild the economy, which it describes as “challenging” due to the legacy inherited from the previous administration.
“Through the 2025 Budget Statement, the government will outline additional measures to restore market confidence, enhance fiscal prudence, and ensure transparency and accountability in public finances”.
Felix Kwakye Ofosu, MP., Spokesperson to the President, and Minister, Government Communications
The President’s economic vision, according to the statement, is centred on stabilizing the cedi, curbing inflation, and fostering job creation. Despite the fiscal hurdles, the government has assured the public that it will take the necessary steps to prioritize spending efficiently and ensure value for every pesewa spent.
Debt Sustainability Strategy
By allocating GHS9.7 billion to the Sinking Fund, the government is reinforcing its debt servicing capacity, a move that financial analysts view as a strategic step toward preventing future liquidity shortfalls.
The Sinking Fund, originally introduced during President Mahama’s previous administration, is designed to gradually accumulate funds for the repayment of maturing debt obligations.
This approach is expected to minimize market volatility, as creditors will have greater assurance of the government’s ability to meet its obligations.
Additionally, the decision to honour both cash and in-kind payments under the DDEP signals the administration’s commitment to debt market stability.
Experts argue that predictable and timely payments to bondholders are crucial in restoring the government’s credibility after the economic turbulence of recent years.
Ghana’s economy has faced significant fiscal challenges in recent years, with concerns over high debt levels, a depreciating currency, and rising inflation.
The previous administration’s handling of the economy led to an International Monetary Fund (IMF) bailout program, which aimed to stabilize the macroeconomic environment.
Under President Mahama’s leadership, the current government is prioritizing debt management, expenditure control, and revenue enhancement as part of a broader economic recovery plan.
The upcoming 2025 Budget Statement is expected to introduce additional measures that will further reassure investors and financial markets.
The latest DDEP payments underscore the government’s efforts to rebuild investor trust in Ghana’s financial system.
Following last year’s restructuring of domestic debt, investor sentiment had been mixed, with concerns about the government’s ability to meet its future debt obligations.
However, with today’s payments and the proactive use of the Sinking Fund, it is expected that confidence will be restored in the country’s financial market.
The success of these measures will play a critical role in shaping Ghana’s economic trajectory, particularly in areas such as inflation control, exchange rate stability, and employment growth.
President Mahama’s administration is poised to navigate Ghana through a delicate economic recovery process.
With a focus on fiscal responsibility, strategic debt management, and economic transformation, the government has set the stage for sustainable growth and financial stability.
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