Players Anticipate More Cedi Pressure after Bondholders Agreement
There is an anticipation of growing pressure on the cedi following Ghana’s successful agreement in principle with eurobond holders to restructure $13 billion of dollar bonds.
Despite the good news which is seeing over 4 billion dollars owed to euro bondholders written off, some players believe it comes with its implications.
The Chief Executive Officer of Dalex Finance, Joe Jackson, drew attention to the fact that some dangers lie ahead as the country is scheduled to settle some $477 million to these bondholders in principal and interest before the end of the year.
According to him, the perfect outlook painted by the Finance Minister is not actually what will be seen as pressure on the cedi will mounts.
“The good news is that we have reached an agreement with our external debtors and we saved this country some money that we couldn’t pay but I want to sound a word of caution. Since the 18th of December 2022, we raised our hands and said we couldn’t pay and since then we haven’t remitted any money to these foreign bondholders to pay off either the interest or the principal of the money that we owe them,” he said in an interview with TV3.
“If you look at the schedule we put out, in 2024, a total of 477 is about to be paid made up of principal $166 million and interest $311 million. That means in the next two quarters, we have to come up with $477 million… We have to pay and because we have to pay, there will be added pressures on the cedi. The cedi is going to be under a lot more pressure.”
According to him, all the pressures the cedi has been spared when it suspended its debt payment is going to be felt when it resumes in the last two quarters of the year.
“In a lot of ways, this cedi has not had the pressure of not sending money to pay people that we owe to bondholders and even then we are even complaining of how fast the cedi is depreciating.”
The cedi in recent months has faced turmoil, steeply losing its value to the US dollar and euro. This week, it is trading at GH¢15.75 to one US dollar.
