Ghana launches $1bn Eurobond

Oct 12, 2015

It becomes the second sub-Saharan country to issue a 15-year bond.

Ghana launched a $1 billion (€880 million) Eurobond on Wednesday (October 7th), Finance Minister Seth Terkper said in a statement.

He said this is the second sub-Saharan country after South Africa to issue a 15-year bond, adding that the bond was 100 per cent oversubscribed, which is showing a "high appetite for Ghana's credit".

Ghana's deputy finance minister Cassiel Ato Forson said the bond will support debt financing and the government's budget.

Ghana already raised $1billion in September 2014 through a Eurobond oversubscribed with orders of up to $3 billion.

In March, Moody's dropped the sovereign rating of Ghana from "B2" to "B3", with a negative outlook.

The US agency justified this decision by citing the country's growing debt burden. "The first driver of the downgrade is Ghana's deteriorating fiscal strength as reflected in the significant increase in the government debt ratio to an estimated 67.2 percent of GDP in 2014 from 54.8 per cent in 2013," it said in a statement.

"The negative outlook reflects further downside risk to the country's debt dynamics and liquidity pressure in the short-term if the country's policies fail to successfully contain its fiscal deficit, stabilise its currency and address current impediments to higher economic growth," it added.

In October 2014, Standard & Poor's also lowered the rating of Ghana to "B-", a level similar to the one recently awarded by Moody's.ADNFCR-2976-ID-801802798-ADNFCR