Use proceeds from the 2nd Eurobond for PPP projects – Ken Ofori-Atta

Former Executive Chairman of Databank Group and Investment Banker, Ken Ofori-Atta, is impressing on government, the need to channel the resources to be generated from the country’s second Eurobond into public private partnership projects.

The Finance Ministry yesterday officially confirmed JOY BUSINESS’ earlier report that the government had settled on CITI- Bank and Barclays as lead managers for the issue.

Government plans to raise some 1 billion dollars from the international capital market in July to clear some maturing debts and finance some infrastructure projects. Mr. Ofori-Atta tells JOY BUSINESS, the move couldn’t have come at any better time for the country.

“This is a great time to raise money because Europe and America are just not getting yields and so any paper from outside the world would yield rates higher than what the institutional investors would get would be attractive. The one billion Euro could be used to re-finance that the old debt in a cheaper model. But Cheaper money used to productively is good for the economy” he said.

Mr Ofori-Atta, however, had some advice for government moving forward.

“Clearly we should look at our debt profile portfolio and determine the cost of debt to know what we want to swap to get cheaper financing. But I think what happens. Long term financing is good, but I think there may be a lot of which they can then partner more private firms to get into infrastructure. As things stand now, I don’t think the country is a position for public expenditure to support our infrastructure needs especially given the country’s total debt (both domestic and foreign) which is pegged at around 20 billion dollars. And so a very aggressive stance on seeking Public Private Partnerships I believe is what’s going to be the order of the day” he noted.