Individual bondholders petitioned Ofori-Atta to exempt us from debt exchange.
The Ghana Individual Bondholders Forum has asked Finance Minister Ken Ofori-Atta to exclude its members from the government’s domestic debt exchange program.
The forum is one of the organizations that is vehemently opposing the government’s decision to give individual bondholders a haircut as part of the debt restructuring initiative.
The forum, comprised of individuals holding investments in the Government of Ghana’s Local Cedi Bonds, the Government of Ghana’s Local USD Bonds, ESLA PLC Bonds, Daakye Bonds, Ghana Eurobonds, and Collective investment schemes with investments in the above securities, stated that the program’s announcement “has been extremely unsettling and catastrophic for our membership” and demanded that they be excluded.
The Individual Bondholders Forum, like the other individuals and unions opposing the program, claimed that its members were not consulted prior to the program’s announcement.
“Since the start of considerations and discussions on the government’s debt restructuring in the second half of 2022, Individual Bondholders have not been involved in the process. This contradicts the contractual principles of good faith, fairness, and best practices.”
The group claimed that the program is one of the harshest debt restructuring measures ever enacted and that if implemented, it will impoverish its members.
“The social impact of the DDE as currently presented for individuals is the harshest on any investor category and catastrophic to the livelihoods of the about 1.3mn direct and indirect bondholders and their dependents. Individual Bondholders, unlike other investor categories that are likely to benefit from the Financial Stability Fund, have no recourse.”
The group also stated that it feels stabbed in the back by the Bank of Ghana’s implementation of the program, which will worsen the living conditions of its members, the majority of whom are pensioners.
“We relied on the Bank of Ghana’s zero-risk rating for government bonds. On the basis of this trust, we chose to invest our strained earnings in government bonds to provide the income security required to meet pertinent needs such as medication, children’s education, and the general welfare of our families. The decision to include Individual Bondholders in the DDE brings back painful memories of the losses suffered by many of our members during the infamous banking sector cleanup.
It will be a sad case of double jeopardy for the government to oversee a process that will cause ordinary Ghanaians to suffer yet again after the recent banking crisis.
“Our members include pensioners whose sustenance, health, dignity of independence and honour of responsibility in taking care of their young wards and families depend on their returns and cashflow from these government securities. The DDE structure is at odds with the programmed needs of individuals, resulting in pain and punishment. “How do you expect them to sustain themselves?”
The group also urged the Finance Minister to leave a sympathetic legacy in the hearts of those who had put their trust in him, rather than one of extreme suffering and unforgiveness.
“Sir, let it not be said ever that during your tenure, your policies impoverished citizens whose primary duty to country was service and love through hard work and taxes. Your proposed DDE for Individual Bondholders violates our right to self-sufficiency, demeans hard work, and deprives us of legally acquired property. None of these are consistent with the principles of good governance.”
The petition also names the President, Vice President, Chairman of the Council of State, Speaker of Parliament, Majority Leader of Parliament, and Minority Leader of Parliament.
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