…says it’ll boost investor confidence
The Ghana Investment Promotion Centre (GIPC) has touted the country’s recent 2018 US$2 billion sovereign bond issue at the international capital market, as profitable.
The 10-year bond raised US$1 billion at 7.627 percent while the maiden 30-year bond raised another US$1 billion at 8.627 percent
“For an emerging market like our country, the achievement is unprecedented and laudable. The bond is a testimony to the fact that Ghana is seen in a good light relatively”, GIPC’s CEO, Mr. Yofi Grant told the Goldstreet Business at the Economic Counsellors Dialogue in Accra.
Despite the big rate, the country is able to comparatively acquire a good rate which enables it to swap interest rates, taking out shorter term, more expensive money for long term less expensive money.
The situation, Mr. Grant explained offers the country exciting times ahead as an improved economy will drive in more foreign investors and improve confidence of doing business in Ghana.
“And that is positive as the sovereign bond issue was oversubscribed by US$5.5 billion but we picked US$2 billion and it is the first time that any country has been able to stretch maturities that long at that level,” he said.
That, he explained, is a great testimony of what investors are seeing in Ghana and we believe that we can sustain it.
“What government wants is irreversible sustainable growth because it is that growth that will offer opportunities for people to create jobs and businesses,” Mr. Grant said.
With an export economy largely dependent on cocoa, gold and oil, the country is in its final year of a US$918 million IMF credit deal to narrow fiscal deficit, inflation and public debt which hit 69 percent of gross domestic product in December.
The government plans to use some of the proceeds to refinance debt and up to US$750 million as revenue for its 2018 budget.
Lead advisers for the sale were Bank of America, Merrill Lynch, Citigroup, JP Morgan and Standard Chartered.
It was Ghana’s sixth sale since a 2007 debut.
By Wisdom Jonny-Nuekpe