US$50 billion bond to be factored into 2019 budget – Ofori-Atta

The Finance Minister, Ken Ofori-Atta has indicated that government’s plan of raising the US$50 billion century bond will be factored into the upcoming 2019 budget.

In an interview at the end of the launch of the Public Investment Management System on Tuesday in Accra, Ofori-Atta noted that this century bond is expected to be raised following the 2019 budget.

He expressed optimism, saying, “we are not going to use all at once. Eventually we will raise it, certainly”, adding, “we are a country with a lot of promise, and I believe that Ghana Beyond Aid that would motivate us to do that.”

The plan is to raise the said amount over a period and possibly in different currencies based on investor appetite and planned uses.

“Among other things is our current intention to structure the US$ 50 billion century bond to deal with our development need in a very programmatic way. And given about US$ 7 billion that is needed, so we are talking about the next 7 years, and how to ensure that we know where resources are so we do not have overruns and the projects are done on time,” Ofori-Atta said.

Essence of the Bond

In a related report, the Finance Minister mentioned that the imminent issuance of the century bond will eventually stabilize the cedi and possibly strengthen it.

Government expects to completely restructure the country’s economy through the century bond, and eventually help to reduce pressure on the cedi and stabilize it. To a large extent, this forms part of the government’s plan to secure long-term funding to build critical infrastructure for industrial development.

This plan has been met out with lots of skepticism in financial markets, with analysts expressing doubts over Ghana’s capacity to undertake such a transaction.