DDEP is an unconstructive disruption, catastrophic - Senyo Hosi

The Individual Bondholders Forum (IBF) have welcomed government’s decision to extend the deadline for the Domestic Debt Exchange Programme (DDEP) to January 31, 2023.

This would be the third extension since the programme was launched by the government on December 5, 2022.

But Convener for the IBF, Senyo Hosi speaking, in an interview with GhanaWeb Business maintained that government must exclude individual bondholders who have collective investment schemes from the entire debt restructuring exercise.

“The debt exchange programme in its current structure is disruptive and disruption is not a bad idea if it's constructive but this programme is an unconstructive disruption and its rather catastrophic and that's where our challenges lie,” Senyo Hosi stressed.

Touching on possible engagements with government on the DDEP, Senyo Hosi said the position of the IBF remains clear on the total exclusion of individual bondholders from the debt restructuring exercise.

“Government's best option is to exclude individual bondholders from the programme and we keep our fingers crossed on what government has to offer," he noted.

“…It is also obvious that government’s insatiable demand to spend what it does not have and spend irresponsibly is the summary of the entire problem we are facing today. Government must rather be holding a crisis introspection meeting to restructure the way it handles the domestic economy.”

He further advocated for a change in the attitude of government spending in order not to burden the citizens in the future just like in the case of the current debt restructuring exercise.

Meanwhile, the Ministry of Finance on January 16 announced an extension to the deadline for the DDEP.

It explained that the move is to pending further stakeholder engagements and consensus building with institutional and individual investors who were recently invited to join the debt exchange programme.

As part of efforts to secure an IMF bailout and address the country’s unsustainable debt situation, government launched the DDEP inviting bondholders to voluntarily exchange approximately GH¢137 billion domestic notes and bonds of the Republic including ESLA and Daakye for a package of new bonds.

Since its announcement, various groups of bondholders in the financial sector have called on their members to reject government’s Domestic Debt Exchange Programme due to a lack of broader consultations and negotiations.

MA/FNOQ