Business in Ghana

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Posts Tagged ‘Eurobond’

The Rains Came Down, and. Critical News, 11th October 2015

Posted by Business in Ghana on October 11, 2015

Sydney Casely-Hayford, sydney@bizghana.com

This week, it rained. Two days of not what you would call relentless downpour, but it rained. I say for a country that is in the tropical zone, it was normal rain for two days.

But as if to test the drains and the waterways that E&P has fixed, and as if to give us a chance to expose more corruption, the rains came down and the floods went up; the rains came down and the floods went up, and the storm drains came tumbling down.

If you remember that well-aged nursery rhyme you can hum the words and understand how much these little childhood songs were meant to shape our world and remind us every time of the simple things we must do in life. A stitch in time saves nine? Rain rain go away? They are worded for a reason; reasons we have washed under waterways because we don’t see the wisdom in them any more.

Many advisory dance tunes, relevant in today’s Ghana, will be made political in a few months as we skate unwillingly to another euphoric December, when we should be lamenting our popularity contest through an electoral register with registrants from the ECOWAS fraternity.

Nkrumah Circle as usual, was flooded to the hilt together with all the flood prone areas, and this wasn’t a major storm. I was caught in it for an hour between The Times junction and Nkrumah circle. When I arrived at the small bridge over the Odaw River, it was rising and starting to rapid. Even as I longed for a dinghy to float to the confluence of the Korle Lagoon, the stench that told me “cholera” reined in my adventurism and stopped me numb in my car seat. Read the rest of this entry »

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Fitch Warns Ghana On New Eurobond

Posted by Business in Ghana on June 10, 2014

By Sudip Roy, FT

Fitch has warned that Ghana will find it “increasingly challenging” to sell its new Eurobond due to mounting fiscal and external vulnerabilities.

The West African nation is rumoured to have hired Barclays, Deutsche Bank and Standard Chartered for an up to US$1.5bn Eurobond, though the timing of the deal has yet to be determined.

A successful deal may ease immediate external funding pressures. But even though Ghana, as with other emerging markets, has seen its outstanding debt rally significantly over the past few weeks with its 2023 notes trading at just under 8% compared with more than 9% at the end of April, Fitch reckons the cost of any bond “would likely be high.”

The ratings agency has highlighted the country’s vulnerabilities in a new note published on Monday, especially the central bank’s role in funding Ghana’s budget deficit in the first quarter.

“Printing money to finance the deficit will aggravate already high inflation (14.7% in April 2014) and contribute to further cedi weakness,” said the note, adding the currency has fallen 21% since the start of the year. Read the rest of this entry »

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Decade after debt relief, Africa’s rush to borrow stirs concern

Posted by Business in Ghana on March 22, 2014

BY TOSIN SULAIMAN, JOHANNESBURG

(Reuters) – Nearly a decade after Nelson Mandela and anti-poverty activists Bono and Bob Geldof persuaded the rich world to forgive Africa’s crushing debts, many countries’ debt levels are creeping up again, which could undermine the region’s growth boom.  As African states line up to join the growing club of dollar bond issuers, economists and analysts warn of a slide back into indebtedness that could undo recent economic gains and create a “Eurobond curse” to match the distorting “resource curse”.  “Eurobonds have become like stock exchanges, private jets and presidential palaces.  Every African leader wants to have one,” said one investor, asking not to be named.

In 2007, Ghana became the first African beneficiary of debt relief to tap international capital markets, issuing a $750 million 10-year Eurobond.  Since then, previously debt-burdened countries, such as Senegal, Nigeria, Zambia and Rwanda, have also put their names on the list of bond issuers.  Governments seeking to replace declining foreign aid and pay for infrastructure are also taking concessional funds from multilateral institutions, more expensive commercial bank loans and bilateral financing from lenders like China and Brazil. Read the rest of this entry »

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