Ken Ofori Atta, Minister of Finance
Ken Ofori Atta, Minister of Finance

DDEP non-participants won’t be penalised - Ofori-Atta to individual bondholders

The Ministry of Finance has re-emphasised that there will be no punitive action against any individual who decides not to participate in the domestic debt exchange programme (DDEP).

However, those who opt against signing up are not guaranteed market liquidity for the old bonds, because they are likely to become less tradeable on the secondary market compared with the new bonds.

On the other hand, individuals who sign up for the new bonds will have more certainty even in a changing economic landscape.

The Minister of Finance, Ken Ofori-Atta, said this in an interview with the Daily Graphic to provide an update on the ongoing consultations with the various stakeholders, particularly, individual bondholders on the DDEP.

Mr Ofori-Atta said in deciding to join or not, individuals must ask themselves what their individual contribution to the exercise to make Ghana more debt sustainable and strengthen its economy would be.

“Let me emphasise again that the DDEP is purely voluntary and there will be no punitive action against any individual who decides not to participate. Individuals who sign up for the new bonds will have more certainty even in a changing economic landscape.

“We must all, however, ask ourselves two questions: what is my individual contribution to this exercise to make Ghana more debt sustainable and strengthen her economy?

“Secondly, how are my old bonds likely to perform on the secondary market? The reality as I shared with the group is that government does not control the secondary market and no one can guarantee market liquidity for the old bonds which will likely become less tradeable than the new bonds on the secondary market.

“It is, therefore, up to individuals to make an informed decision about whether they choose to participate in the DDEP or not,” the Finance Minister emphasised.


The Government is seeking a US$ 3 billion International Monetary Fund (IMF) bailout as its debt to gross domestic product (GDP) ratio reaches an unsustainable level of almost 100 per cent.

The plans it proposed as an assurance for its debt sustainability drive hit a snag following protests from the various stakeholders likely to be impacted by the DDEP as part of the efforts to sign onto the programme.

While banks and insurance companies expressed concern about the impact of the DDEP on their respective sectors, organised labour and individual bondholders vehemently protested their inclusion, leading to the extension of the deadlines from December to January 16 and now, January 31.

The various individual bondholders came together to form the Individual Bondholders Forum (IBF) to organise their front to protest their inclusion and petition their exemption.

In the past week, the government has managed to reach deals with the banks and insurance companies

Despite its initial objection to being part of the DDEP for fear of not being able to meet their obligations, with total liabilities amounting to GH¢5.96 billion under the current DDEP programme, the insurance companies last week agreed to sign up for the deal.

This follows a review of the arrangement for insurance companies.

Under the revised arrangement, the insurance sector has 40 per cent of its investments amounting to some GH¢4.6 billion directly exposed to Government of Ghana securities, with an additional 10 per cent invested in licensed banks and fund managers.

The third quarter of last year’s financial analysis showed that assets of non-life insurance companies stood at GH¢4.92 billion while that of life was GH¢6.60 billion.

Also earlier in the week, the banks also agreed to terms, including an agreement to pay five per cent coupon for 2023 and a single coupon rate for each of the 12 new bonds resulting in an effective coupon rate of nine per cent, clarity on the operational framework and terms of access to the Ghana Financial Stability Fund (GFSF) and the removal or amendment of all clauses in the Exchange Memorandum that empowers the Republic to, at its sole discretion, vary the terms of the Exchange.

As part of getting a buy-in, the ministry set up a technical committee for broader stakeholder engagement which has resulted in the progress being made.

Already, the government has agreed to pay five per cent coupon (interest) on bonds for this year.

It will also pay a single coupon of nine per cent on the 12 new bonds it proposes to issue to domestic bondholders who tender their old bonds.


Last Friday, at the technical meeting, Mr Ofori-Atta stressed the need for all to come together to help reach the landing zone in terms of our domestic debt reduction targets as an immediate solution.

He said the government remained deeply sensitive to the possible impact of the DDEP on household and retirement incomes and was, therefore, designing an offer for individual bondholders, which would be announced very soon.

In addressing the concerns raised, Mr Ofori-Atta said the ministry would come up with a package that would soften the blow on households and retirement incomes in addition to considering the suggestions the IBF had made for fiscal adjustments and revenue generation as a medium-term solution.

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