ISSER demands clarity on Ghana’s return to capital market

Institute of Statistical, Social and Economic Research (ISSER) has called for greater clarity and transparency in the government's plan to return to the capital market to finance its economic programmes.

The call was made by the Director of ISSER, Professor Robert Darko Osei, during a review of the 2025 Mid-Year Budget Statement at the University of Ghana, Legon.

His comments follow the Finance Minister's statement regarding Ghana's intention to tap into the capital markets.

Ghana has been locked out of the international capital markets since 2022, when its soaring public debt and fiscal deficits triggered a sovereign credit downgrade into junk territory (CCC+/C).

This culminated in a Domestic Debt Exchange programme (DDEP) in 2023 and the seeking of a $3 billion loan from the International Monetary Fund (IMF).

The country's last Eurobond issuance was a $1 billion 7-year bond in March 2021, which carried a coupon of 7.75 per cent.

Prior to that, in 2020, Ghana issued a $3 billion triple-tranche bond with coupons as high as 8.63 per cent, reflecting risk perceptions even before the default.

Prof. Osei acknowledged that an improved sovereign credit rating would position Ghana to secure capital at more competitive rates,

He however expressed concern over the lack of specific details in the budget document.

“The important thing and to help improve that financing of this big push is to let it be translated in the budget, which we do not see,” Prof. Osei stated.

He emphasised that without clear budgetary allocation, it was difficult to assess the viability of the projects to be financed.

“If it’s not very clear in the budget in terms of how we are going to finance it, then it raises questions because you cannot appropriately interrogate the cost benefits of said projects,” he added.

The economist also commented on the broader fiscal outlook, noting that current revenue figures “are not too good,” which could hinder the full achievement of the budget targets.

Prof. Osei, highlighted potential pressures from domestic financing, pointing to “significant undersubscription” of treasury bills in recent years and questioning what that would mean for government borrowing if the trend continues.

GNA