Parliament has given government the green light to issue a 1.5 billion Eurobond.
[contextly_sidebar id=”2uqPI3KMDb0CaRK9Lfx36oB7xtwrIwe6″]Prooceds from the bond will be used to help in the management of liabilities and general budgetary support.
The Minister of Finance, Seth Terkper made the request for Parliament to give the green light during his presentation of the mid-year review budget on Tuesday.
Government had earlier asserted that it intended to raise 1 billion dollars but layer increased it to 1.5 billion dollars.
According to Finance Minister Seth Terkper the USD 500million dollar increase in government’s 1 billion dollar Eurobond is as a result of the budget review as well as the partial risk guarantee by the World Bank.
Speaking in a joint interview with Citi Fm and Radio Gold, the Finance Minister said the support from the bank will to a large extent help government settle debts that are expected to mature in 2017.
”In the revision of the budget line in March, we were looking at the implications of the crude oil price drop and we had said it will result in lower revenues and therefore it’s important we take immediate remedial steps which was debated, to determine whether it had legal or constitutional basis.”
According to Seth Terkper, ‘at the time that it was fiscally prudent to do; hence most of the review on the budget line is premised on the budget review and the fact that this year’s Eurobond will be 1.5 billion instead of the 1 billion’. He stated.
This will be the first time in 11 years in the sub region that the World Bank is going to guarantee Ghana’s activities on the international market.
The support allows for a 15 year payment period with proceeds to be channeled into capital projects.
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By: Lorrencia Nkrumah/citifmonline.com/Ghana