Ghana fortifies its plan to pay off existing debt by increasing its goal for the sale of Eurobonds to as much as $2.5 billion, report making rounds says.
Prior to the new development, the finance ministry had announced that Ghana may issue close to $2 billion on foreign debt.
Speaking about the increase for the Eurobond sale over a phone call on Wednesday, the country’s Finance Minister Ken Ofori-Atta told Bloomberg that Ghana intends to use $1 billion as a strategy to plug its 2018 budget hole and another $1.5 billion to refinance dollar debt.
Aiming to attract foreign investors in its weekly sale of local notes, the minister revealed that West African country is considering issuing around 500 million cedis ($113 million) in global depositary notes.
Ofori-Atta said “We will examine the trading pattern of the issues that we have, and if we get better pricing, we’ll ship some out.”
Ghana is the first African country to co- list a Eurobond on the local exchange as its 10-year Eurobond in 2016 was listed on the Ghana Stock Exchange to afford local, foreign and prospective investors the opportunity to buy and trade on the secondary market. Ghana successfully issued new Eurobonds in 2016, raising $750 million at a yield of 9.25 percent that was more than five times oversubscribed.
Ghana is in the league of sub-Saharan African nations including South Africa and Ivory Coast looking to sell debt before yields increase as a result of the U.S. Federal Reserve’s policy-tightening path.
As at last week Senegal attracted more than $10 billion in bids for an issuance of about $2.2 billion in dollar and euro-denominated debt; a debt sell that came after Egypt, Nigeria and Kenya sold a total of $8.5 billion of Eurobonds this year, bringing the continent’s total issuance so far in 2018 to $10.7 billion.