Government Borrows GHS 115.77 Billion from Treasury Bill Market in H1 2024, Marking 70.22% Increase Year-on-Year
The Government borrowed GH¢115.77 billion from the treasury market in the first half of 2024, a significant 70.22% increase compared to the same period last year.
This surge in borrowing underscores the government’s robust demand for market funding amid ongoing economic challenges.
During the first six months of 2024, investors submitted total bids worth GH¢116.07 billion, reflecting a continued strong appetite for treasury bills.
This investor interest has been driven by the need to balance long-term risks associated with Government of Ghana (GoG) bonds while securing competitive real returns through T-bills.
Money Market Thrives Amid Economic Uncertainty
The money market has maintained its upward trend, continuing to boom throughout the first half of 2024.
This growth trajectory has been evident since the onset of Ghana’s economic difficulties, with investors flocking to the relative safety of treasury bills.
T-Bill Yields Decline on Positive Inflation Outlook
T-bill yields declined sharply in the first half of 2024, influenced by a positive inflation outlook and a 100 basis points cut in the monetary policy rate in January 2024.
The 91-day and 182-day tenors saw substantial decreases of 449 basis points and 515 basis points, ending June 2024 at 24.87% and 26.80% respectively.
Similarly, the 364-day yield dropped 470 basis points to 27.79%.
Record Weekly Uptakes Highlight Strong Demand for Money Market Funding
The government’s strong demand for money market funding was evident, with weekly uptakes reaching record levels.
The trend highlighted the government’s reliance on short-term securities to navigate its funding needs amid ongoing economic pressures.
*GOVERNMENT CAN NOT BLAME THE CURRENT ECONOMIC CRISIS ON DOMESTIC DEBT EXCHANGE PROGRAMME.*
Ghana’s economic woes have sparked heated debates, with Finance Minster squarely blaming the Domestic Debt Exchange Program for the current crisis. The Minister of Finance Dr. Mohammed Amin Adams has rendered an apology to Ghanaians for the Hardships imposed on them by the Domestic Debt Exchange Programme (DDEP).
He stated that the programme was carried out as one of the requirements for the programme with the International Monetary Fund (IMF).
Forster Oteng Amoako, a Tax Consultant and Financial expert vehemently disagreed with the Finance Minster. The root of the current economic crisis runs deeper.
The Finance Minster can’t blame the economic crisis on the DDEP but rather on Government’s Mismanagement of the Economy. It is disheartening to witness the bad fate and lack of positive impact coupled with low value for money on loans granted to the government of Ghana.
Corruption and Mismanagement have indeed hindered the desire outcomes expected from loans which eventually erode the expected benefits to ease the economic pressure on the economy and the ordinary Ghanaian.
Some projects are awarded without due process, others are done on unwarranted sole sourcing all with the aim of personal and individual benefits without the nation first.
The Governments failure to institute prudent and sound economic policies and implementation of same is the root cause of Ghana’s economic crisis.
Tax revenue is on leakage, with excessive tax waivers without convincing justification.
Lack of value for money, poor control measures and our lukewarm activity to ensure adherence to financial, legal and economic regulations.
All these are happening due to the economic and financial Mismanagement. The resulting effect is the economic crisis with Domestic Debt Exchange programme as a symptom.
The Finance Minister’s apology should rather focus on the Mismanagement of the Economy resulting in Hardships and economic crisis to the citizenry but not to attribute the economic crisis to the DDEP.
It is expected of the finance minister to take proactive action on the uncultured acts and conducts that underpins economic growth and development.
Good governance, Transparency, Accountability, Proper mind set and stiffer punishment is indeed needed to revamp the economic.
FORSTER OTENG AMOAKO
(CA, MCITG,MIoD)
0247026753