FINANCIAL innovation is booming in Ghana, with the government planning to issue sustainable bonds with the aim of expanding access to education.
According to a Bloomberg report, if successful, an education bond would be the first to be issued in Africa at the government level.
Ghana was celebrated this year as the first African country to also issue zero coupon bonds – a move that has sparked a debate on how going down this path could lead to more costly debt issuances to the country. to come up.
According to Bloomberg, the recent plan is for the cocoa-rich country to raise up to $ 1 billion by June.
The proceeds from this issue would help refinance domestic debt used for social and environmental projects, including loans taken to pay for the government’s free high school policy, Charles Adu Boahen, the finance minister said this week.
The use of social bonds has exploded since the Covid-19 pandemic, but so far only a few sovereign issuers have sold them, including Chile and Ecuador.
The European Union has emerged as the lead player, to fund a job recovery program, shattering records for global debt demand in the process as investors flock to ethical assets.
“With this issue, we seek to refinance these debts already contracted to undertake projects in the environmental and social sectors. Of all that we are going to increase our mandate in the financial markets this year, only 1.5 billion US dollars represents new debt, the rest is intended for refinancing or repurchase ”, declared the minister.
The government will use some of the same advisers for the issuance of sustainable bonds, Adu Boahen said, without giving further details.
* Supplementary report, Bloomberg Africa