Thursday, 30 May

DDEP: Gov't pays GH¢5.8bn as 2nd coupon – Akufo-Addo says it's biggest daily coupon paid in history

Business
President Nana Addo Dankwa Akufo-Addo

President Akufo-Addo has said bondholders affected by the domestic debt exchange programme have been paid their second coupons totalling GH¢5.8 billion.

In his State of the Nation Address in parliament on Tuesday, 27 February 2024, Mr Akufo-Addo recalled that "a year ago, I stated the decision to undertake a comprehensive debt restructuring of our domestic and external debt to ensure we remain resolute in our objective to restore macroeconomic stability and sustainable growth." 

The decision, he noted, "was not an easy one, considering the complex and diverse domestic debt landscape."

"We had to consider safeguarding the financial sector, preserving social and economic conditions, and protecting our domestic debt market", he explained.

A year on, Mr Akufo-Addo said: "I am happy to inform you, Mr. Speaker, that we have made significant progress". 

"We requested an unprecedented number of bondholders to participate in a voluntary exchange, and we were able to exchange successfully some two hundred and three billion cedis (GH¢203 billion) worth of bonds". 

"Not only was the exchange successful, but it helped us to secure, within five (5) months, the shortest possible time in recent debt restructuring history, a Staff Level Agreement to an Executive Board Agreement with the IMF", he added. 

"My gratitude goes to all financial sector players, organised labour, firms, regulatory institutions, and all individuals who made this painful exercise successful". 

He said: "Mr. Speaker, as you may recall, Government successfully paid the first coupon of two-point-three billion cedis (GH¢2,369.67 million) on the new bonds on 22nd August 2023. At the time, that was the single biggest payout of domestic payments in a single day for Ghana."

"We, then paid two billion and sixty million cedis (GH¢2,060.72 million) for the last leg of the domestic debt exchange on 5th September 2023." 

"A week ago, last Tuesday, on 20th February 2024, the second coupon of five-point-eight 

billion cedis (GH¢5,847.72 million) was paid to domestic bondholders". 

"This is the largest coupon paid in a day in Ghana’s history", he asserted. 

On the external debt side, he said "we achieved a significant milestone by reaching an agreement with our public creditors, and I will use this occasion to express our appreciation to the Republic of France and the People’s Republic of China, co-Chairs of the Official Creditors Committee, for their positive roles in this achievement". 

"We have also intensified our engagement with our external bondholders on the principles of transparency, fair treatment, consistency with the IMF debt sustainability 

analysis, and good faith". 

"We are focused and committed to accelerating the process". 

"Mr. Speaker, we are committed to concluding the external debt restructuring process as soon as possible, so we move past the crisis. This will enable us to complete substantially projects that have been constrained due to financial challenges", the president added.

Source: classfmonline.com