Ghana: The Ghanaian Finance Ministry yesterday announced that the government’s pension fund debt exchange had closed with a 95% participation rate, while the USD-denominated bonds exchange had closed with a participation rate of around 92%. Pension funds have agreed to exchange GHS29.6bn (cUSD2.6bn) of the GHS31bn existing bonds for two new notes with maturities in 2027 and 2028.
The average rate on the old instruments was 18.5%, whereas the new notes will pay a total 21% coupon. Bloomberg, citing the finance ministry, reported that the higher coupon rate is to ensure that the special restructuring does not result in any financial losses for pension funds. Out of the USD809mn in qualifying bonds, investors additionally agreed to exchange USD741.7mn of foreign-currency-denominated notes for two new instruments maturing in 2027 and 2028 with yields of 2.75% and 3.25%, respectively.
Bloomberg further reported that the Cocobod will offer 13% on five new bonds maturing in 2024 through 2028 to investors who tendered GHS7.7bn of their existing GHS7.9bn of cocoa bills for the new notes (Reuters, Bloomberg).
Nigeria: The latest Central Bank of Nigeria (CBN) Export and International Payments data show external debt service payments of USD1.17bn in H1 23 compared with USD1.37bn (-14.5% y/y) in the corresponding period in 2022.
The 2023 budget, finalised by the Buhari administration, expected total debt servicing costs of NGN6.1tn (cUSD7.9bn), which was 71% more than the initial 2022 estimate due to the inclusion of interest payments of NGN1.2tn for the Ways and Means advances.
The approved 2023 budget showed debt servicing costs of NGN5.24tn. Updated fiscal data released last month showed that Nigeria’s debt servicing cost was around 99% of revenues during the first three quarters of 2022, although the budget data, approved at the beginning of the year, pointed to a ratio of around 90% during the first eleven months of the year. It is this ratio (90%) that the President referred to last week when he stated that the country cannot afford to pay that much of its revenues in servicing its debt. He called it a ‘path to destruction’ that is not sustainable.
Following the first meeting of Federal Executive Council (FEC) under Tinubu’s administration, Finance Minister Edun stated that the federal government is not in a position to borrow more money at this time and emphasised the importance of creating a stable macroeconomic environment.
Gabon: Several news agencies, including Bloomberg and All Africa Global Media, are reporting that soldiers appeared to have seized power in Gabon following the elections held on 26 August. These reports are still unconfirmed but follows the appearance of army officers on state television where they announced that they have cancelled the election results and will be dissolving the country’s institutions.
The events come after the electoral body declared President Ali Bongo as the winner of the elections, winning a third term in office. The Gabonese Election Centre last night announced that Bongo received 64.3% of the vote, while the main challenger, Albert Ondo Ossa, received 30.77%. The opposition has claimed substantial irregularities.