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Business & Analysis

Government to borrow ¢2.6bn in first quarter

By : cd on 15 Jan 2021, 10:49     |     Source: myjoyonline

Bonds

The Government of Ghana will borrow GH¢2.6 billion as fresh amount to meet its financing requirements in the first quarter of 2021.

This is made up of 91-day Treasury bills, 182-day Treasury bills, 364-day Treasury bills, 3-year bond, 5-year bond, 6-year bond, 7-year bond and 20-year bond.

According to the Government Issuance Calendar for Quarter 1, government plans to issue a gross amount of GH¢22.3 billion, of which GH¢19.7 billion are to be used to settle maturing debts or rollover.

Per the calendar, the government will float GH¢10.4 billion as 91-day T-Bills, which actually is the biggest of the financial instrument to be issued. This is followed by the 2-year bond which an expected GH¢4.13 billion will be issued.

The 182-day T-Bills, 3-year bond and 364-day T-Bills, will follow suit with expected issuance of GH¢1.7 billion each and GH¢1.405 billion respectively.

GH¢1.4 billion, GH¢800 million, GH¢700 million and GH¢111.4 million are the expected issuance for the 5-year bond, 6-year bond, 7-year bond and 20-year bond respectively.

Whilst, the 91-day and 182-day Treasury bills will be issued weekly, the 364-day T-Bill will be issued bi-weekly. This will be done through the primary auction with settlement being the transaction date plus one working day.

Securities of 2-year up to 7-year will be issued through the book-building method.

The issuance of the 20-year bond will also be done via a shelf offering and re-opened based on investors request and on market conditions.

The government said it will update the issuance calendar on a monthly rolling basis, to reflect a full quarter financing programme.

Public debt stock hits ¢273bn in September 2020

Ghana’s public debt stock hit ¢273.8 billion, about 71% of Gross Domestic Product in September 2020, according to the November 2020 Summary of Financial and Economic Data by the Bank of Ghana.

That was equivalent to $48 billion.

Between July and September 2020, the nation added ¢10.7 billion to its public debt stock.