The lack of transparency surrounding Ghana’s debt exchange programme is raising concerns among market participants and investors, with some questioning the government’s ability to effectively manage its debt.
Director of Business Operations at Dalex Finance, Joe Jackson, has joined a growing chorus of calls for greater transparency from the government regarding the conversion of bonds into Treasury Bills, as well as which eligible bonds were converted and which category of investors benefited from the conversion.
Many market analysts and investors are concerned about the lack of consultations and engagement with investors in the implementation of the debt exchange programme. Transparency is crucial in the financial markets, and investors need to have confidence that the government is acting in their best interest.
The absence of transparency and engagement with investors undermines investor confidence, which is essential for effective debt management.
The government’s lack of clarity regarding the debt exchange programme is particularly worrisome given recent reports indicating that it is still swapping old bonds for new ones, even though the programme was scheduled to end on February 10, 2023.
Reports suggest that investors have tendered in some GHS 4.9bn in bonds to be included in the debt exchange programme, raising the overall tendered bonds to over GHS 87.8bn from the previous amount of GHS 82.9bn.
However, the government has not provided details regarding which investors are taking up the new bonds and which debt instruments they are exchanging for these new bonds. This lack of transparency creates uncertainty and may result in investors questioning the government’s intentions, which could lead to further anxiety in the market.
The government’s failure to clarify the debt exchange process and provide detailed information on the investors taking up the new bonds and the debt instruments they are exchanging for the new bonds is a cause for concern. This lack of transparency undermines investor confidence and may lead to a loss of trust in the government’s ability to manage its debt. The government must address these concerns and ensure that the process is transparent, fair, and accessible to all investors.
It is crucial that the government provides greater transparency regarding the debt exchange programme and engages with investors to ensure that their interests are adequately represented. Transparency is essential in the financial markets, and investors need to have confidence that the government is acting in their best interest.
By addressing these concerns and providing greater transparency, the government can build investor confidence and support its efforts to reduce the country’s debt burden.