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Opinions of Sunday, 11 October 2015

Columnist: Daily Guide

Nothing to rejoice about

Is there anything worth rejoicing about a $1 billion Eurobond at a double-digit yield? For the first time in the economic history of Ghana a double-digit yield is what we have attracted under a Eurobond arrangement.

We had rejected an earlier proposal which was a little over 10.75%. The investors as it were, walked away when we told them our initial offer, their position being informed by Ghana’s poor credit rating and general worrying economic indicators.

The story is a different one when other countries which went on a road show are put under the spotlight. They are on single digits because the health of their economies has not degenerated to the level of ours.

For us to return with a fresh proposal almost ready to do their bidding suggests the level of our desperation under circumstances which are worrying.

We are relishing what Angolans found repulsive, even under a single digit. If we ever thought that our economy is one of the best in Africa as we are used to putting out, our treatment at the hands of the foreign investors is enough to tell us our real level.

A female Ghanaian politician on the other side of the political divide while on a political dais, said Ghana is No 1 on the continent. She however, changed her rating to ‘Ghana is among the top five on the continent.’ She could not have been talking about a subject outside economics.

When we commented on this subject in a previous edition, we pointed out that government players were still at the heels of the investors and could succumb to their dictates. With no option available, they have had to accept a yield of over 10%. The repercussions following this acceptance are enormous. We would continue to be stretched as long as we run the economy the way we are doing.

We have had to eat the humble pie. Receiving an amount less than $500,000 subscription says a lot about the health of our economy, but when the propagandists go to town to do the bidding of their paymasters of throwing dust into the eyes of Ghanaians, they would, we bet, let these important details in the bag.

Credible experts have told us that this is the first time that we are going into a double-digit yield. The economy is due for intensive care treatment. Unfortunately, we are not ready to accept openly that we are indisposed, let alone seek treatment.

Our poor rating is what has accounted for the yield we have eventually agreed to. The macro-economic indicators on the ground speak a lot about where we are.

We must begin to address these realities without using the political lenses we have used for many years now, otherwise we would be stuck in a quagmire.