The Ranking Member on Parliament’s Finance Committee, Dr Ato Forson

Ranking Member on Parliament’s Finance Committee has described as a hoax government’s suggestion that there will be no haircuts on investments.

According to Dr Cassiel Ato Forson, while government may try to avoid an explicit haircut, an implicit haircut cannot be escaped.

He noted that factors such as the cedi depreciation, inflation among others will cause investors to lose significant value on their bonds despite the government’s ‘no haircut’ mantra.

He has, therefore, called on government to come clean on the risks involved in its debt exchange programme and engage key stakeholders who have largely been ignored in this very crucial decision making process.

Speaking on JoyNews’ PM Express, he said, “First of all it is a hoax for a government to suggest that there will be no haircut. There is what we call an implicit haircut in the calculation. For example, I have one million Ghana cedis bond in a government bond, for example, I’ve bought the Daakye bond and it’s one million Ghana cedis.

“This Daakye bond is supposed to mature in 10 years’ time or probably let’s even use the three years Daakye bond. Back of the envelope calculation, the government is giving me 25% for example every year as coupons.

“You’re saying that you have ceased the bond and now that bond, one, instead of me getting all my one million cedis in the next two or three years you’re saying you’re giving me 17% in five years’ time, another 17% in seven years’ time, 25% in 10 years’ time and then indeed 41% in 15 years’ time.

“You’re only going to attract 0% coupon in year one, 5% coupon in year two, and then obviously 10% coupon in year three and thereafter for the next 15 years. If you calculate, the present value loss is about 65%.”


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“And so the government is also not candid enough to tell the people of Ghana the truth. They’re still lying in the middle of a major crisis like this that you need everybody on board, I think that is wrong because you need to let the people know the kind of haircut they will get,” he added.

Meanwhile, Ghana is inviting eligible holders to exchange GH₵137.3 billion of the domestic notes and bonds, including Energy Sector Levy Act Plc and Daakye Trust Plc, for a package of New Bonds to be issued by the country.

It said offers may only be submitted starting from December 5, 2022, and ending at 4:00 p.m. (Greenwich Mean Time (GMT)) on December 19, 2022.

However, Ghana may at its sole discretion extend the expiration date, including for one or more series of eligible bonds.

The invitation is available only to registered holders of eligible bonds that are not individual investors or that are otherwise authorised by the Government of Ghana, in its sole discretion, to participate in the Invitation.