The government of Ghana accepted all bids amounting to GHS668.76 million through the issuance of the 2-year bond on Friday, 8 May 2020.

The yield on the debt instrument, which is expected to mature in 2022, was 18.75%

Due to challenges in the global economy, where a lot of investments have been lost by investors due to the coronavirus pandemic, analysts have welcomed the coupon rate, which, they say is within the acceptable limit.

Class Business understands that almost all the monies will be used to settle maturing debt (principal and interest), leaving very little or none for capital investments.

The debt instrument was opened to both resident and non-resident investors.

Each bond had a face value of one Ghana cedi with a minimum bid of GHS50,000 and multiples of GHS1,000 thereafter.

Absa, Databank, Fidelity, IC Securities, Stanbic were joint book runners.

The government of Ghana will, this year, spend GHS22 billion on interest payments on loans.

The country is, however, targeting GHS67.7 billion as total revenue and grants for this year.

A chunk of this will go into wages and emoluments, as well as the cost of servicing debt.

Interest payments on Ghana’s debt increased by 8.97% to 40.71% at the end of the third quarter of 2019