Ghana may soon join the likes of Argentina, Austria and Mexico to issue the rare 100-year bonds to finance national projects. President Addo Dankwa Akufo-Addo announced this at a ceremony in Beijing to sign some eight Ghana-China co-operation agreements.
“The Ministry of Finance and the economists in Ghana are looking at floating a $50 billion Century Bond. This will provide us with the resources to finance our infrastructural and industrial development. We are hoping that, at some stage, China will interest itself, and take a part of it as China’s contribution to Ghana’s development,” he told Chinese President, Xi Jinping on Saturday.
Discussions about ultra-long term debts have been fraught with uncertainty due in part to interest rates fluctuations that can lower yields for investors; however, some analysts say there is a growing demand for these types of bonds. Many of these long-term bonds contain an option that lets the issuer to partially or fully repay the debt before the scheduled maturity.
With Ghana exiting the IMF programme by the end of this year, President Akufo-Addo stressed that the country is determined never to return to that arrangement. “In order to do so, we are looking seriously at how we can secure sources of long-term finance that will allow us to deal with our infrastructural development, and also realize the vision of a Ghana Beyond Aid.
Ghana and China on Saturday eight co-operation agreements and memoranda of understanding, in different sectors of their respective economies, aimed at deepening the ties of co-operation and the bonds of friendship that exist between the two countries. The agreements were signed on Saturday September 1, 2018, after the President and the President and Xi Jinping held bilateral talks, as part of President Akufo-Addo’s state visit to China.
The agreements are the “One belt one road Memorandum of Understanding”, “Memorandum on Regional Aviation Co-operation”, “Agreement for Co-operation in the peaceful use of nuclear energy”, and “Co-operation to carry out Maternal and Child Health Project”.
The rest are “Framework Agreement on Financing Insurance Co-operation” ($2 billion Sino-Hydro deal), “Economic co-operation on Phase 2 project of the University of Health and Allied Sciences, Ho”, “Co-operation on the expansion of the Cape Coast Stadium”, and “Co-operation on the supply of police vehicles to the Ghana Police Service.”
Speaking with President Xi Jinping, prior to the signing of the eight agreements, President Akufo-Addo noted that the relationship between Ghana and China, over the years, have been excellent, noting that “Ghana has been a firm friend of China.”
With China, for the last three years, being Ghana’s largest trading partner, the President stated that “Chinese co-operation and investment in our economy are extremely essential” to the delivery of progress and prosperity to the Ghanaian people.
Highlighting some matters of critical concern to the country, President Akufo-Addo noted that his Government has been engaged in the fight against the menace of illegal mining, popularly referred to as galamsey, and told the Chinese President about the involvement of some Chinese nationals in the illegal activity.
He emphasised that his administration will not relent in the fight to restore the purity of Ghana’s water bodies and the health of its environment.
President Akufo-Addo urged his President Xi Jinping to intervene in the matter, stating that “we want your help fully so that we can remove this impediment to the strong co-operation between Ghana and China.”
On the development of Ghana’s infrastructure, he also told his Chinese counterpart that Ghana is interested in receiving investments from China towards specific sectors of the economy, such as the railway and road network.
“We are thinking about a railway network that is intended to be a part of the Belt and Road Initiative, which will link our country to the Maghreb Region, and, thereby, recreate the old trade route that linked the Southern part of West Africa to North Africa,” he added.
By George Nyavor