Some economists have lauded government on the issuance of a historic 15-year bond, as part of measures to pay off some debts accrued from the issuance of short-term bonds by the previous government.

The finance ministry yesterday successfully issued 15 and 7-year bonds with the same coupon of 19.75%, raising a total amount of $1.13 billion.

The ministry raised the cedi equivalent of $1.12 billion in 5 and 10-year bonds via a tap-in arrangement. “These activities raised a total of $2.25 billion and resulted in the lengthening of the maturity profile of the instruments available on the domestic market.

“This issuance represents the largest amount issued by a sub-Saharan African country in a day,” a statement from the ministry indicated. Speaking with 3FM Business, economist Dr. John Gatsi says this long term bond is in line with the country’s path to reducing the public debt. “The country has taken a decision which has been factored into what is called the debt management strategy.

I think this will give government the space to plan and pay off debts and that is the best way to go in debt management”, he added For economist Courage Kingsley Martey, the issuance of this long term bond, will further renew investor confidence in the Ghanaian market “The government has a debt management strategy which essentially involves borrowing long to pay off debts.

This government has taken the notch higher and or will allow the government to take time to plan and reduce the pressure that comes with paying short term debts.

This will even allow for the private sector to also participate in borrowing,” he emphasized.

According to a statement from the Ministry of Finance, the issuance attracted a number of global portfolio investors, including a very substantial investment in the 15-year bond by a well respected global financial investor.

The Minister of Finance, Ken Ofori-Atta, stated that the proceeds from the issuance will be used to repurchase and/or retire a portion of the higher coupon short-term public debt instruments, meaning there will not be an overall increase in the total debt stock.