Government has assured persons who refused to participate in the just ended Domestic Debt Exchange Programme that they will be paid their outstanding coupons and maturing principals which will be undertaken with government’s fiscal commitments.
According to the finance ministry, the DDEP is being done to help protect the economy and enhance government’s bid to resuscitate the economy.
“The Government would like to reassure all individual bondholders who elected not to participate that your coupon payments and maturing principals, like all Government bonds, will be honoured in line with Government fiscal commitments.”
Finance Ministry
Contained in a statement issued by the Ministry of Finance on Tuesday, February 14, 2023, it expressed gratitude to the people of Ghana for their support and contribution. The ministry further noted that the alternative for not executing the DDEP would have brought grave disorder in the servicing of the country’s national debt and exacerbated the current economic crisis.
“The government is, therefore, grateful for the overwhelming participation of all bondholders.”
Finance Ministry
The finance ministry revealed that government’s Domestic Debt Exchange Programme (DDEP) closed on Friday 10th February 2023 with over 80% participation of eligible bonds.
It explained that by the participation of the voluntary bondholders after the closure of the Programme on Friday, the country has inched closer towards securing the $3 billion extended credit facility (ECF).
“Your support and contribution have gotten your country much closer to securing the IMF programme.”
Finance Ministry
In light of this, the ministry iterated his gratitude to Ghanaians for their “forbearance and support” throughout these very difficult times. Particularly, it thanked bondholders for their overwhelming participation.
“The DDEP is being done to help protect the economy and enhance our capacity to service our public debts effectively.”
Finance ministry
The Individual Bondholders’ Forum on Monday, February 13, 2023, called on the government to honor all coupon and principal payments due bondholders with bonds not tendered into the Domestic Debt Exchange Programme.
In a statement, Convener of the group, Senyo Hosi, reminded the Finance Minister, Ken Ofori-Atta, that payment of coupons and principal for bonds that matured since the 6th of February to date (herein referred to as ‘Due Bonds’) remain outstanding.
In the letter, the individual bondholders stated that honoring payments on due bonds will re-engineer public and investor confidence and trust in the activities of the Finance Ministry.
Impact of financial illiteracy in the country
Meanwhile, another Convener of the Individual Bondholders Forum, Martin Kpebu, has bemoaned the high levels of financial illiteracy in the Ghanaian society.
According to him, due to the fact that most Ghanaians not knowing how the financial sector works, it has given government the leeway to do as it pleases without hindrance.
Referencing government’s “coercion” of financial institutions to sign onto the domestic debt exchange programme, he stated that if most Ghanaians were aware that they had a stake in the running of the banks, there would have been a stronger fight to get the banks not to sign up for government’s debt exchange programme.
“What this has taught me about the Ghanaian system is that, I think we’re not that financially literate. Because the way we’ve sat down for the banks to be treated in this manner, is a shame. I realized it too late… And we say we’re shareholders of the banks.”
Martin Kpebu
Mr Kpebu indicated that now that government has signed the agreement with stakeholders such as the Ghana Association of Bankers, people will lose their dividends this year.
