Ghana raised $2billion in its first ever Eurobond with the longest length of time, comprising ten and thirty-year bonds, meant to improve infrastructure and in turn create jobs. The development represents the first time a sub–Saharan country with a rating of B stable has priced a sovereign Bond at such low costs indicating strong investor confidence.
The country sold $1 billion each of the 10-year notes maturing in 2029 and a 30-year with 2049 maturity at 7.625 percent and 8.625 percent, respectively. Ghana has achieved remarkable macroeconomic stability and growth in this regard.
On the hugely successful issue of the bond, the Finance Ministry explained that the government was seeking to raise 750 million dollars. However, upon completion, the Sovereign bond accrued two billion dollars from investors. The success of the bond among other factors demonstrates the high level of investor confidence in the country.
According to the US-Africa Business Centre in Washington DC, an organization responsible for the Investor Confidence Indicator for Africa (ICIFA), Ghana ranked among the best countries in Africa in terms of convenience of doing business. The report, which is a tool for government and industry leaders is used to make policy and investment decisions that drive economic growth. The report was released to enable investors to decide on countries in which to push in capital for business.
Investor confidence in the upstream petroleum sector has also shot up following Ghana’s recent victory at the International Tribunal for the Laws of the Sea (ITLOS). This has led to some investors expressing interest in developing the Saltpond oilfields.
The Minister of Energy, Mr Boakye Agyarko, stated that the definite nature of the decision, which favoured Ghana against Cote d’Ivoire over a maritime boundary dispute, had contributed towards whipping up investor confidence and interest in the upstream petroleum sector. Source: Ministry of Energy
Prudent policies by the government in the micro and macroeconomic space is yielding positive results. Month on month inflation has hit single digit, interest rates are on the downward trend with treasury bill rates averaging about 13%. Reduction in electricity tariff, 30% for industrial establishments and about 17% for domestic consumers and fair stability in the exchange rate have further strengthened confidence in the Ghanaian economy.
According to the World Bank, Ghana is one of the fastest growing economies in the world, with projected growth being approximately 8% by end of 2018, above the global average. The government is committed to and continues to work towards building a unique environment for investments to thrive.
Source :G.I.P.C. Corporate Affairs