President Mahama has instructed the Ministry of Finance to pay the Domestic Debt Exchange Programme (DDEP) bondholders their matured coupons and create a financial buffer through government’s Sinking Fund.
The DDEP was an economic recovery measure forming part of a prerequisite arrangement between the Ghana government and the International Monetary Fund (IMF), as the country strived to recover from an economic downturn. The measure which was implemented in 2019, was to restructure the country’s domestic debt portfolio by exchanging short-term, high-interest-bearing debts for longer-term and lower-interest-bearing obligations. As part of government’s effort to succesfully implement the policy, it has had to use funds of different categories of bondholders.
The approach sparked outrage from bondholders, leading to series of protests. Eventually, the government was able to reach an agreement with the boldholders, thereby paving the way for the implementation of the DDEP.
Following President Mahama’s directive, the Ministry of Finance has made a payment of 6.081 billion cedis worth of coupons to bondholders. Additionally, the government has also “honoured the Payment-In-Kind (PIK) portion of GHS3.46 billion, deposited into the respective bondholders’ securities accounts in line with the DDEP Memorandum.
As a buffer mechanism, the government has also “paid into the Debt Service Recovery Cedi Account (Sinking Fund) an amount of GHS59.7 billion as a buffer for the 5th DDEP coupon that will fall due in July and August, 2025,” a directive dated Monday February 17, 2025 said.
The directive also emphasized the Mahama administration’s commitment to honouring obligations under the DDEP, adding that government, through its 2025 budget will announce further measures targeted towards restoring market confidence.
Source: Dehotpress
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