News:
June 26, 2014
Parliament on Wednesday approved of government’s request to issue $1.0 billion Eurobond on the international capital market.
According to government the decision to issue the bond is to reduce its over-reliance on short term domestic instrument to finance capital projects and diversify its sources of funding.
Presenting the Finance Committee’s report, the Chairman James Klutse Avedzi stated that the ministry of finance intends to apply part of the funds raised to finance capital projects in the 2013 Budget statement.
Part of the proceeds will also to be used to refinance existing maturing short term debt instruments and also to swap existing external debt to reduce the cost of debt servicing.
Touching on the timing of the bond issue, Hon. Avedzi said the minister stated that the bond market is a global one and no sibgle country has control over it.
According to the minister the presence of big players like Nigeria will rather send positive signal to investors about prospects of the sovereign bond market in West Africa.
Minority MPs were not enthused about issuance of the bond as to them the timing was wrong and could add more debt to the already huge national debt stock.
However the Majority was all for the issuance as it will enable government attend to numerous projects that needs to be urgently carried out.
Kwadwo Anim/Ghanamps.gov.gh