Government to issue its fourth Eurobond in September

sethGovernment is likely to turn to the international market this September to raise 1.5 billion dollars from foreign investors.

Joy Business has learnt that the September date is subject to favourable market conditions.

But some analysts say the timing may not be right because most investors may just be returning from their summer holidays.

Meanwhile, a source close to government has also told Joy Business, the administration has to carry out the necessary engagements with investors and also go out and look for banks and financial institutions that will sponsor the 1.5 billion dollar Eurobond.

Some economists are also observing the interest the state will pay on the bond, following the 400 million dollar credit guarantee secured from the World Bank with its AAA ratings.

The country paid out about 9 percent interest on the last Eurobond issued.

Government is hoping to use proceeds from this Eurobond to finance projects in the budget and pay off portions of the previous bond that will be maturing in 2017.

Some market players are confident of Ghana having a successful Eurobond issue come September.

They are, however, of the view that the country’s fourth Eurobond issue is likely to secure a lower interest rate and some heavy participation from foreign investors.

Analyst Mike Cobblah says the current economic recovery will aid a successful Eurobond.

“If for nothing at all having an IMF programme has added some policy credibility to what we are doing, and the general perception is that once you have someone overseeing what you are doing then you must be doing something right.

“So essentially I think that investors will look at us with a more attractive eye than they used to. We are in a better position now than the last bond we issued”, he added.

source: modernghana.com