Domestic Debt Exchange: Togbe Afede Says Government’s Promise Of ‘No Haircut’ Is A Mockery

• The Agbogbomefia of the Asogli State has criticized the government’s recently introduced domestic Debt Exchange programme
• Togbe Afede XIV says assurances that there will be “no haircuts” in the proposed programme is a mockery
• The programme which was launched last week is aimed at realigning some domestic bonds ahead of the bailout package from the International Monetary Fund (IMF)

The pledge of "no haircuts" in the proposed domestic Debt Exchange scheme by the Akufo-Addo-led government has been criticized as a farce by the Agbogbomefia of the Asogli State.

According to Togbe Afede XIV that assurance cannot be taken seriously since the opposite is currently happening.

Domestic Debt Exchange: Reduction In A Promised Coupon Simply Means A Haircut - Togbe Afede

According to him, the government's plan to reduce a promised coupon, as disclosed by the finance ministry, is simply a "haircut."

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The venerable chief expressed his opinions in a 14-page opinion piece, lamenting the effects of the Debt Exchange scheme and asking how Ghana, a country endowed with abundant resources, could have been mismanaged into this situation.

“..We are making a mockery of ourselves talking ‘no haircuts’ when that is exactly the effect of reduction in promised coupon payments,” excerpts of the piece read.

Government Launches Domestic Debt Exchange Programme Ahead of IMF Bailout

Following the dire financial situation in the country coupled with escalating debt stock and high-interest payments, the minister of finance, Ken Ofori-Atta announced a domestic debt exchange programme.

The programme which has been heavily criticized by a section of the populace including labour unions and the minority in parliament is aimed at realigning some domestic bonds in order to give the government fiscal space ahead of the bailout package from the International Monetary Fund (IMF).

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Nhyiaeso MP Dr. Stephen Amoah cautions Ghanaians against panic withdrawals amid Debt Exchange Programme

Ofori-Atta: Finance Minister Announces Plans To Swap Cedi Debts for New Bonds In Domestic Debt Exchange Scheme

Earlier, YEN.com.gh reported that the finance minister informed local bondholders that there would be losses on interest payments under the Domestic Debt Exchange program on the evening of Sunday, November 4, 2022.

According to Ghana's finance minister, four new bonds with maturities in 2027, 2029, 2032, and 2037 will replace the country's current local-currency debt.

He also added that the annual coupon on all these new bonds will be set at 0% in 2023, 5% in 2024, and 10% from 2025 until maturity.

Source: YEN.com.gh