The Ghanaian parliament on December 23, 2015, approved the issuance in 2016 of another Eurobond of up to $1 billion which will be injected in the budget and the country’s debt.

The issuance was green-lit by most deputies despite members of opposition refusing Ghana to rely once again on international debt market especially considering the present context whereby American interest rates are hiking, a factor which could significantly raise the cost of the operation.

Addressing deputies, Minister of Finances, Seth Terkper, stated that out of the Eurobond, $750 million would be injected in the budget whereas the remaining $250 million would serve to refinance a previous Eurobond which matures in 2017.

Since 2003-2012 where its GDP grew about 7.5% per year due to significant gold, cocoa and oil exports, Ghana has been experiencing economic challenges, from 2013, resulting from its inability to contain inflation, budget deficit and debt/GDP ratio.

Truly, the Western African nation saw its public debt soar up to 94.5 billion cedi ($23.7 billion) last June ending which represents 71% of GDP against 67% on December 31, 2014 and 55.8% at the end of 2013. The country’s public deficit is of about 10% while cedi, the national currency, greatly weakened to the dollar throughout the year.

In sight of this challenging economic environment, rates for the recent Ghanaian Eurobond issued in October 2015 ($1 billion) surged to 10.75%.

The Ghanaian government last February signed an aid agreement for 918 million USD with International Monetary Fund (IMF) to end the cedi’s crumbling and curb inflation.