Century bond necessary to stop hand-to-mouth existence – Ken Ofori-Atta

The Finance Minister, Mr Ken Ofori-Atta, has defended government’s plans to issue a Century Bond in the coming months, stating that long-term debts are needed to uplift the country and the citizenry from the “hand-to-mouth existence.”

The debts will also put Ghana on a firm trajectory of growth and prosperity, the minister said when he presented the 2019 Budget Statement and Economic Policy.

He further assured that the government’s overall plan to issue ultra-long-term bonds was not intended to derail the country’s debts sustainability path but to rather enhance it.

“If we really want to uplift ourselves out of this hand-to-mouth existence and put our country, Ghana on a firm trajectory of growth and prosperity, we will need to source long-term, affordable financing to invest in strategic infrastructure over the medium to long-term,” he said

Defending the decision to go long-term, Mr Ofori-Atta said the country’s current phase of massive economic transformation requires a more ambitious financing arrangement.

He explained that the country also needed strategies to retire about half of the country’s existing debt, which were issued during a high-interest rate environment during.

As a result, he said “we shall issue sovereign bonds of longer tenor either as green bonds or Eurobonds on the international capital markets and also structure a Sovereign Century Fund for our bilateral
investor partners.

“The Sovereign Century Fund shall engage on a bilateral basis to raise long-term concessional financing to underwrite our other commercial infrastructure needs through GIIF, GIADEC, PPP projects and other entities as well as liability management,” he added.