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Debt Exchange: Govt is nowhere near the ideal 80% participation rate – Bright Simons

With just one working day left before government’s deadline for the debt exchange programme, that is Monday January 16 2023, the government of Ghana is nowhere near the ideal 80% participation rate, a Vice President of Imani Africa, Mr Bright Simons has said.

Individual investors have until January 16 to sign onto the debt exchange programme.

Bright Simons also indicated that the government will also not get the 60% rate it needs to at least show “good progress”.

Current commitments are too few, Mr Simons said.

He explained in a tweet on Thursday January 12that “The problem is not just active resistance. But also logistical. Some Funds & banks are trying to mobilise client bond owners to sign up 1st before committing on their own holdings & struggling due to general confusion, uncertainty & doubt. Financial literacy is also a block.”

The debt exchange programme has faced massive rejection since its announcement.

For instance, Convener of the Individual Bondholders Forum (IBF) Senyo Hosi said regarding the domestic debt exchange programme that in an unfortunate oppressive fashion, the government has shown total disregard for the contractual rights of Individual bondholders and has made no effort to structure reasonable consultations with individual bondholders.

In the process, the IBF said, Ghanaians have been presented with painfully stark, impoverishing and unsustainable choices – a situation deeply troubling and wholly untenable.

“This is only possible because of the absence of effective representation and the perceived ease of oppressing a dispersed section of investors into submission,” a statement issued by Hosi said.

The Government of Ghana (GoG) announced that under its Domestic Debt Exchange (DDE) programme, individual bondholders were to submit to a “voluntary” arrangement to exchange their domestic bonds for new benchmark bonds.

This arrangement, according to IBF, irreversibly takes away the wealth and livelihoods of direct and indirect individual bondholders whose only crime has been to trust their government.

Tied to this is a mandatory deadline which compels holders to either accept the government’s offer or risk the threat of prohibitive losses, the Forum added.

It stressed “In an unfortunate oppressive fashion, government has shown total disregard for the contractual rights of Individual bondholders and has made no effort to structure reasonable consultations with individual bondholders. In the process, we have been presented with painfully stark, impoverishing and unsustainable choices – a situation deeply troubling and wholly untenable.

“This is only possible because of the absence of effective representation and the perceived ease of oppressing a dispersed section of investors into submission.”

By Laud Nartey|3news.com|Ghana

 






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