Ghana has issued its first dollar denominated domestic bond worth $94.64 million in two-year paper with a coupon rate of 6 percent, consistent with an initial price range of 5.5-6.5 percent, the Finance Ministry said on Monday. The bond was open only to investors resident in the West African country and attracted 26 bids totalling $99.64 million. Proceeds from the bond will form part of a government 'sinking' fund to repurchase or redeem debt.
"The successful issuance of the bond evidenced by the generally high subscription and the favourable pricing is a reflection of the returning confidence in the Ghanaian economy," the Finance Ministry said in a statement. Ghana is emerging from a fiscal crisis that includes elevated inflation and a steep public debt that forced the government into an aid deal with the International Monetary Fund last year worth around $918 million over three years.
The country issued a $750 million Eurobond last month at a yield of 9.25 percent and said the yield was further evidence of returning confidence. The economy is a central issue ahead of an election in December when President John Mahama will stand for a second and final term against opposition leader Nana Akufo-Addo, who points to slowed economic growth since the president came took office.