An Individual Bondholder has disclosed that none of their recommendations made to the government to raise more revenue without involving the funds of individual bondholders in the domestic debt exchange programme has been considered in the final proposals.
Speaking on the Citi Breakfast Show on Tuesday, February 7, Michael Yamson, said all the proposals that have been presented to them have been unilateral from the Finance Minister.
“Up until now, we have essentially seen only unilateral proposals. None of the conversations that were entered into by the technical committee between the government and the individual bondholders has been reflected. All the proposals that we made that we talked about almost 83 billion cedis, none has been discussed by the government.”
The deadline for signing up for the programme expires today, Tuesday, February 7, 2023.
The government has hinted that it may no longer extend the deadline for subscribing to the domestic debt exchange programme which has been postponed three times already.
Mr Ofori-Atta said though the extensions delayed the execution of the programme, such decisions were needed to alleviate the country’s “debt burden in the most transparent, efficient, and sustainable manner.”
“We admit that there were legitimate and critical concerns which needed deeper and broader consultations. The requisite efforts to address them have resulted in improved terms and changes in the closing date, with a final deadline of February 7.”
But Mr Yamson, however, added that proceeding with the debt exchange programme will eventually harm the economy and negatively affect the trust of investors in government bonds.
“There will be a long-term loss of confidence and anything that the government does in the financial space. People will simply not trust to keep their monies with the government, people will not save, and people will keep their monies in their bedrooms and that is not good for us in the long term.”
The Individual Bondholders as part of their recommendations asked the government to divest loss-making, defunct and troubled 17 State–own enterprises.
They also suggested that the government should review the Free SHS Programme to make it more efficient through effective targeting and allowing parents who can pay to do so.
According to the group, “beneficiaries should be students that patronize Senior High Schools in their communities whilst other students should pay for boarding. However, the government can pay for students who do not have Senior Secondary schools in their communities.”
The group stated that divesting the 17 non-performing SOEs and reviewing the free SHS alone will provide the government with GH¢2 billion.
The group also urged the government to maintain the 2022 capital expenditure level by reducing the non–ABFA MDA and foreign finance Capex provisions by 50% which they claim will provide the 10.7 billion Ghana Cedis.
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