Ghana will issue a new seven-year domestic bond next week, marking its first return to longer-dated local debt markets since suspending such issuance after its sweeping debt restructuring three years ago, the finance ministry said Thursday.
The move is being closely watched by investors as a sign of the West African country’s efforts to restore confidence in its domestic debt market after a painful restructuring triggered by its 2022 sovereign default.
According to a finance ministry circular, the new bond will have a seven-year maturity and will be offered from March 30, with the book-building process closing on April 1 and settlement scheduled for April 7.
The ministry said the note would be marketed to domestic investors while also being opened to non-resident investors, in what analysts see as an important test of foreign appetite for Ghana’s local-currency debt following the restructuring.
The auction is aimed at “supporting liquidity management and refinancing of maturing obligations; rebuilding a sovereign yield curve; and providing investment opportunities and restoring market confidence for retail and institutional investors,” the ministry said.
The minimum bid has been set at 50,000 Ghana cedis (about US$4,575), while the coupon rate will be determined during the issuance process.
Ghana’s return to the seven-year segment is significant because the government has largely avoided issuing medium- to long-term domestic securities since the debt crisis forced it to suspend such borrowing and rely more heavily on short-term Treasury bills and private placements.
That shift followed one of Africa’s most far-reaching debt restructuring exercises, after Ghana defaulted on much of its external debt in 2022 amid soaring inflation, a weakening cedi, and mounting financing pressures.
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The government subsequently restructured both its domestic and external debt as part of a broader effort to stabilise the economy and secure support under a $3 billion International Monetary Fund programme.
The domestic debt exchange programme, launched in late 2022 and completed in 2023, saw bondholders swap old instruments for new ones with longer maturities and lower coupon rates. The process, while intended to reduce debt servicing pressures, dealt a blow to investor confidence and strained relations between the state and many domestic institutions, including banks, pension funds, and individual bondholders.
Since then, the government has relied heavily on short-term borrowing to meet financing needs, with Treasury bills becoming the main instrument for raising domestic funds.
The return to a seven-year note suggests authorities are now seeking to gradually re-establish a fuller sovereign yield curve and reduce dependence on short-dated borrowing, which can expose governments to rollover risks and refinancing pressures.
Economists say the success of the issuance will be seen as an indicator of how far confidence has recovered in Ghana’s macroeconomic outlook and fiscal management.
The opening of the bond sale to non-resident investors could also provide a useful gauge of whether foreign investors are ready to re-engage with Ghana’s domestic debt market after the restructuring.
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Ghana’s economy has shown signs of stabilisation in recent months, supported by fiscal reforms, stronger revenue mobilisation, easing inflationary pressures, and progress in debt negotiations.
However, the country remains under pressure to maintain fiscal discipline, reduce debt vulnerabilities, and rebuild investor trust as it works to restore access to both domestic and international capital markets.
For the government, a successful bond sale would represent more than just a financing exercise. It would also signal a cautious but important step in Ghana’s post-restructuring recovery, as authorities seek to reassure investors that the domestic bond market is once again open for longer-term lending.
The outcome of the auction is expected to be closely monitored by investors, policymakers, and development partners alike, as Ghana continues its effort to move beyond one of the most difficult financial crises in its recent history.
