Make debt exchange programme acceptable

 As it is the case everywhere in the world, the Ghana government has borrowed domestically in addition to interna­tional credits to run the economy and promised to pay interest after agreed periods.

As part of the requirements for Ghana to secure an Ex­tended Credit Facility of $3 billion from the IMF to re­store macroeconomic stability and debt sustainability while protecting the vulnerable, preserving financial stability, and laying the foundation for strong and inclusive recovery, the country has to undertake a domestic debt exchange (DDE) programme.

Usually, such a decision follows a Debt Sustainability Assessment (DSA) jointly conducted by the IMF and the World Bank to determine whether the government is able to meet all its current and future payment obligations.

Thus, the current DDE pro­gramme being pursued by the country is a sine qua non (an indispensable requirement) for securing the IMF deal.

However, since the govern­ment announced the DDE programme on December 5, last year, there have been agitations in the labour sector, and after threats of strikes, the gov­ernment have amended some details of the DDE.

The agitations, in part, are due to the fact that the government is seek­ing to amend the interest it promised the lenders (the bondholder) and the duration for which the lender is supposed to get his interest and principal back.

It also seems a good number of people do not have the full understand­ing of the programme.

Besides, the govern­ment seems not forthright about which funds it in­tends to touch and which ones will be exempted such as pension funds.

Even though the gov­ernment entered into advance discussions with multiple stakehold­ers, which resulted in the amendment of the terms of the offer and announced on December 24, 2022, to expire on January 16, 2023, in the circumstances, a fur­ther extension has been announced to expire on January 31, to enable it to do broader consultation and build consensus for the programme.

We think this is com­mendable because the success of the DDE programme hinges on its full understanding and ac­ceptance by stakeholders, particularly the bondhold­ers.

Analysis of the current happenings means the advance discussions done at the outset involved a limited number of the stakeholders.

Even now, we can en­visage that some stake­holders could be left out because they may not readily come to mind but can be indirectly affected.

These are non-bond­holders but people who have investments with finan­cial institutions that may be included in the programme and as a result cannot pay their clients their interest and prin­cipals back at the agreed times.

We should not forget the happenings following the bank-sector clean-up exercise undertaken by the govern­ment.

As things stand now, there must be extensive and inten­sive consultations to build the expected consensus for the success of the programme.

We hope the government would abide by its sovereign decision that the DDE pro­gramme is a voluntary exer­cise, meaning there is room for domestic bondholders to choose to be part of it or not.

We hope this time around, the government would listen to everyone and the other stakeholders too, including the Minority in parliament, would be assertive but with contributions that would be in the interest of the state for Ghanaians to accept the DDE programme for all its benefits

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