Former Deputy Managing Director of the National Investment Bank (NIB), Alfred Thompson has said that the main opposition is unable to give alternative ideas after rejecting the Debt Exchange programme announced by Finance Minister Ken Ofori-Atta.
He questioned what the ideas of the National Democratic Congress (NDC) are in managing the economy.
Speaking on the Big Issue with Berla Mundi on TV3 Tuesday, December 6, Mr Thompson urged all Ghanaians to support the programme.
“I am pleading with everybody to support this just to bring our economy back on track. If we want to bring the economy back we all have to be in this together,” he said.
He added “You ask the NDC what their alternative measure is, but they they cant give. the opposition couldn’t give any alternative.”
Following the launch of the programme, the Minority Leader in Parliament Haruna Iddrisu said that the debt exchange was actually debt restructuring.
He said the form and structure of the programme announced are unacceptable.
Addressing a press conference Mr Iddirsu said “Let me state without any fear of contradiction that the form and structure of the debt restructuring announced by Finance Minister Ken Ofori-Atta this morning are unacceptable to us and we simply will not accept it.”
He added “The concern of the Minority is that the announcement by the Honorable Minister of Finance this morning has dire consequences on government and Ghana’s financial sector.
“It has dire consequences on jobs and dire consequences on pensions and dire consequences on loans who are compelled by legislation to investigate at least 75 per cent of government instrument and government bonds. We expected government to have thoroughly engaged and consulted before making this far-reaching announcement.”
The Finance Minister Ken Ofori-Atta launched the programme in Accra on Monday December 5.
The objective of this programme, he said, was to alleviate the debt burden in a most transparent, efficient, and expedited manner.
In this context, by means of an Exchange offer, the Government of Ghana has been working hard to minimize the impact of the domestic debt exchange on investors holding government bonds, he said.
In particular, he added, it does not embed any principal haircut on Eligible Bonds, “as we promised. Let me repeat this fact as plainly as I can, in this debt exchange individual holders of domestic bonds are not affected and will not lose the face value of their investments. So let us remove any doubt and discard any speculation that the Government is about to cut your retirement savings or the notional value of your investments. That is not the case.
“As already announced, Treasury Bills are completely exempted, and all holders will be paid the full value of their investments on maturity. There will be NO haircut on the principal of bonds. Individuals who hold bonds will also not be affected at all.
“Our domestic debt operation involves an exchange for new Ghana bonds with a coupon that steps up to 10% as soon as 2025 (with a first interest payment in 2024) and longer average maturity. Existing domestic bonds as of 1st December 2022 will be exchanged for a set of four new bonds maturing in 2027, 2029, 2032 and 2037.
“Predetermined allocation ratio are as follows: 17% for the short bonds, 17% for the intermediate bond, 25% for the medium-term bond and 41% for the long-term bond. The annual coupon on all of these new bonds will be set at 0% in 2023, 5% in 2024 and 10% from 2025 until maturity.
“Coupon payments will be semi-annual. For emphasis, this domestic debt exchange programme will not affect individual bondholders.”
