Government of Ghana borrowing GH¢17.9 billion in second quarter of 2020, here’s what it will be used for

According to the government, GH¢13.6 billion will be used to settle maturing obligations while the remaining GH¢4.27 billion will be used to take care of the government’s financing requirements.

This was revealed in the government’s Issuance Calendar for the second quarter of this year. GH8.2 billion will be the highest to be raised through the issuance of a 91-day Treasury bill.

This will be followed by GH¢2.7 billion which will be raised from the sale of a 1-year note, and a GH¢1.8 billion from a 3-year bond.

The 3-year bond will be issued in April and June 2020 respectively [GH¢800 million and GHS1 billion].

GH¢1.62 billion and GHS1 billion will be raised from the issuance of a 182-day bill and a 5-year bond.

GH¢800 million each will be mobilised from the issuance of a 7-year and 10-year bond respectively.

GH¢700 million will also be raised from the sale of a 2-year bond.

However, for the second time, the government of Ghana will issue a 20-year bond to raise GHS700 million.

According to the Finance Ministry, the calendar is developed based on the Net Domestic Financing in the 2020 Budget, the domestic maturities and the Medium-Term Debt Management Strategy (MTDS) for 2020- 2023.

The Calendar also shows the securities that are intended to be issued in respect of government’s Public Sector Borrowing Requirements for the period April to June 2020.

Ghana ended 2019 with a total public debt stock of GH¢218 billion, according to Bank of Ghana’s December summary of financial and economic data. This was about 63% of Gross Domestic Product.

Out of this, external debt constituted GH¢112.5 (US$20.3 billion). This represented 32.5% of GDP.