Pensions Fund Exempted From DDEP

The government of Ghana has agreed to exempt pension funds from the Domestic Debt Exchange Programme (DDEP).

This follows a meeting between the government and the leadership of Organised labour on Thursday.

Organised Labour and other labour unions kicked against the government’s plans to implement a debt exchange measure that will grant bondholders the option to exchange their existing securities for new ones that will offer zero, five per cent and ten per cent coupons respectively in the first year, the second year and third year as part of measures to reduce the debt burden of the country.

This opposition from organised labour and other unions was due to the inclusion of pension funds in the programme.

Reports say six per cent of the government’s domestic debt is pension funds.

The stakeholders, therefore, threatened to stage an industrial action on December 27 if the government failed to exempt their pensions.

At a meeting between the government and organised labour on Thursday, December 22, the government succumbed to the demand of the latter.

A memorandum of understanding between the parties indicates that pension funds have been exempted from the programme.

In addition, the parties agreed to explore mutually beneficial options within debt sustainability limits, and promote macroeconomic stability and economic recovery.

The country’s debt as of the end of September 2022 stood at GH¢467,371.31 million (US$48,871.34 million) according to provisional results. A debt sustainability analysis by the Finance Ministry showed that Ghana’s debt is unsustainable.

Finance Minister Ken Ofori Atta says 137 billion of the country’s domestic debt needs to be restructured to get the country’s debt to a sustainable level.

Source: opemsuo.com/Hajara Fuseini