Debt Exchange to affect 1.3m individual bondholders and their dependents
Some 1.3 million individual bondholders along with their dependents will be affected by the domestic debt exchange programme, states the Ghana Individual Bondholders Forum.
According to the Forum, the DDEP in its current form will impoverish individual bondholders who are largely pensioners and whose sustenance and honour of responsibility of taking care of their families is dependent on returns and cashflow from government securities.
The IBF argues that, unlike other investor category which are likely to benefit from the Financial Stability Fund, individual bondholders have no support to fall back on.
Adding that, the DDEP is harshest on individual bondholders than any other investor category.
“The social impact of the DDE as currently presented for individuals is the harshest on any investor category and catastrophic to the livelihoods of the about 1.3mn direct and indirect bondholders and their dependents. Unlike other investor categories likely to benefit from the Financial Stability Fund, Individual Bondholders have no support to fall back on.
“We trusted the Bank of Ghana’s zero risk rating on government bonds. We chose to invest our strained earnings in Government bonds on the back of this trust to provide security of income required to meet pertinent needs like medication, children’s education and the general welfare of our families. The decision to include Individual Bondholders in the DDE evokes painful memories of loss many of our members suffered in the infamous banking sector clean up. It will be a sad case of double jeopardy for Government to superintend a process where ordinary Ghanaians will have to suffer yet again after the recent banking crisis.
“Our members include pensioners whose sustenance, health, dignity of independence and honour of responsibility in taking care of their young wards and families depend on their returns and cashflow from these government securities. The structure of the DDE is at variance with the programmed needs of individuals, and therefore, resulting in pains and punishment. How do you expect them to self-sustain?,” quizzed the IBF in a petition addressed to the President.
“Bondholders are not just statistics on your spreadsheets”
Meanwhile, Convener of the Ghana Individual Bondholders Forum, Senyo Hosi, has lashed out at the Finance Ministry, asserting that individual bondholders should not been seen as mere statistics by the Ministry.
According to him, the Finance Ministry should realise that they are dealing with “real human beings” who could have their entire life savings and livelihood taken away from them under the Domestic Debt Exchange Programme being led by the Ministry.
Speaking in an interview on Wednesday, Mr Hosi averred government through the Finance Ministry must open a channel of negotiations between itself and individual bondholders, further asserting that, individual bondholders must be respected and deserve to be represented at the table of negotiations.
“For those at the Finance Ministry, most of you are cranking numbers and seeing it as statistics, but they are not, they are real human beings, real lives and not numbers.
“Bondholders are not statistics you see on your spreadsheets, we have suffered enough, Ghanaians have suffered enough,” he remarked.
