Finance Minister, Ken Ofori-Atta says debt servicing cosumes almost all government funds.
According to him, 70 percent of tax revenues in the country are used to service debt.
Mr. Ofori-Atta announced this when launching debt exchange programme in Accra on Monday December 5, 2022.
He said the programme has become necessary because of the enormous challenges with debt servicing.
He said “debt servicing consumes” almost all government’s revenue and also 70 per cent of tax revenue.”
He continued that “Which is why we are announcing this to restore our capacity to service debt.”
Touching on the debt exchange programme, the Finance Minister explained that, ”domestic bond holders will be asked to exchange their instruments for new ones.”
He continued “Existing domestic bonds as of 1st December will be exchanged for a set of four new bonds maturing in 2027, 2029, and 2037.”
The annual coupons on all of these bonds will be set at 0% in 2023, 5% in 2024 and 10% from 2025 until maturity.
“Coupon payments will be semi annual,” according to him.