Ghana successfully completed its Domestic Debt Exchange Programme (DDEP) in February 2023, which resulted in lower interest rates for its new bonds.
The Bank of Ghana data showed that the new bonds, which range from 4-year to 15-year maturity, had yields between 9.27% and 10.02% in April 2023. This was a significant reduction from the old bonds, which had rates between 16.32% and 20.74% in February 2023 before the DDEP.
The DDEP was a voluntary exchange of about GHS137 billion worth of domestic notes and bonds of the Republic of Ghana, E.S.L.A. Plc, and Daakye Trust Plc for new benchmark bonds of the Republic of Ghana with lower coupons and longer maturities.
The DDEP was part of Ghana’s economic reform programme that aimed to restore fiscal stability and debt sustainability amid the challenges posed by the COVID-19 pandemic and the global economic shock created by the war in Ukraine.
The DDEP was also a key component of Ghana’s negotiations with the International Monetary Fund (IMF) for financial assistance. The IMF programme sought to support Ghana’s efforts to restore macroeconomic stability and debt sustainability while preserving financial stability and protecting the most vulnerable.
The successful completion of the DDEP was expected to unlock the support of the international community and help Ghana reach debt targets agreed with the IMF.