Experts suggest domestic bondholders unite for stronger negotiating power
An economist at the University of Ghana Business School, Prof. Godfred Bokpin, has urged domestic creditors in Ghana to form a united front in their negotiations with the government over the country’s domestic debt exchange programme (DDEP).
Bokpin believes that a unified approach will enhance the effectiveness and efficiency of the negotiations, as well as strengthen the creditors’ position.
He cited the example of Jamaica, where a consolidated approach led to significant fiscal reforms, including the adoption of a fiscal responsibility act and amendments to the constitution.
The Ghanaian government recently modified its DDEP, valued at GHC137.3 billion ($23.8 billion), to include individual investors.
The programme is part of the government’s efforts to restructure the country’s national debt and secure approval from the International Monetary Fund (IMF) for a $3 billion loan-support programme to address Ghana’s economic crisis.
The government has also set a non-binding target minimum level of overall participation of 80% of the aggregate principal amount outstanding of eligible bonds, and has extended the deadline for voluntary participation in the DDEP to 31 January 2023.
