The Government of Ghana has planned to increase its borrowing through the issuance of fresh bonds in the first quarter of the year to help meet its financing requirements.

In its Issuance Calendar for the period between January and March this year, the Finance Ministry indicated that Government aims to raise GHȼ3,785.51 million through the issuance of fresh instruments. The current planned fresh borrowing is higher than the GHȼ1,040.70 million the government raised in the last quarter of 2021 through fresh bond issuance.

In the first three months of this year, government also plans to increase its gross bond issuance over what it raised in the market between October and December last year. The gross amount to be issued in Q1 2022 is GHȼ3, 330.00 million higher than the GHȼ21,170.00 million raised through the domestic bond market in the last quarter of 2021.

“For the period in question, Government plans to issue a gross amount of GHȼ24,500.00 million, of which GHȼ20,714.49 million is to rollover maturities. The remaining GHȼ3,785.51 million is fresh issuance to meet Government’s financing requirements”.
Ministry of Finance

In 2021, the government raised GHȼ 611.94 million through the issuance of fresh bonds between July and September (Q3) which was lower than the GHȼ2 billion fresh funds borrowed between June and August 2021.

Targets for the various bills

The government plans to raise GHȼ11,300.00 million through the 91-day securities and GHȼ3,000.00 million via the 182-day securities. A total of GHȼ2,150.00 million is expected to be raised through the 364-day bills within the three months’ period.

Within this period, the government also plans to borrow GHȼ1,400.00 million, GHȼ1,650.00 million, and GHȼ1,000.00 million using the 2-year, 3-year and 5-year bonds respectively. Moreover, the government intends to raise GHȼ2,000.00 million and GHȼ1,200.00 million using the 6-year and 7-year bonds correspondingly. Between January and March 2022, government plans to borrow GHȼ800.00 million through its long-term 10-year bonds.

Detailing how its intends to issue the securities, the Finance Ministry highlighted that it will roll out the 91-day and 182-day bills on a weekly basis. The Ministry of Finance further stated that the 364-day bills will be issued bi-weekly through the primary auction with settlement being the transaction date plus one working day.

Securities of 2-year up to 10-year will be issued through the book-building method. Consistent with the MTDS, Government may announce tap-ins/reopening of other existing instruments depending on market conditions, the Finance Ministry stated.

Developing the calendar for the period

According to the Finance Ministry, the Calendar is developed based on the Net Domestic Financing provided in the 2022 Budget, the 2022 domestic maturities for the period, the 2022 Borrowing Plan and the Medium Term Debt Strategy.

“It depicts the securities that are intended to be issued in respect of Government’s Public Sector Borrowing Requirements for the period January to March 2022”.
Ministry of Finance

In addition, the Calendar also takes into consideration Government’s liability management programme, market developments (both domestic and international) and the Treasury & Debt Management objective of lengthening the maturity profile of the public debt.

The Ministry of Finance indicated that the figures provided are based on its debt management strategies and current market conditions. The government, through the Finance Ministry, cautioned that the amounts stated in the Calendar are indicative, to guide the market and may be revised when transaction adverts are published. Government intends to update the Issuance Calendar on a monthly rolling basis, to reflect a full quarter financing program.

Government expressed optimism that its January to March 2022 Calendar will meet the requirements of market participants. Government further assured all stakeholders and the public that it continues to strive for greater predictability and transparency in the domestic bond market.