10 Reasons Why Ken Ofori-Atta Failed On US$2.25 Billion

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1. The Finance Minister, failed to produce a single authentic document the Minority demanded.   None of the documents he brought to parliament to supposedly answer the demands was signed.

  1. He also failed to bring the actual Bond document executed between the GOG and Templeton.
  2. The Finance Minister, again failed to disclose the participants to parliament so as we speak, we do not know the names of the entities that participated $2.25b bond transaction. We know who got 95percent, but we do not know who got the rest 5percent.
  3. In law, the doctrine of confidentiality cannot be invoked and relied upon to shield an information or document once a requested to do so under a subpoena. Speaker’s directive to the Finance Minister to produce these amounted to a form of a subpoena.
  4. The Finance Minister claims to have executed this transaction in the 2nd quarter but the evidence points clearly to the fact that it was a 1st quarter transaction concluded by 31st March 2017.
  5. The piece of document the Finance Minister brought to parliament to support his claim that the government’s intentions to issue the bond in question was placed on the issuance calendar as required by law, established that, that information was in respect of another bond and NOT the $2.25b one.
  6. Further, even though the deputy governor of the BOG is on record to have stated before parliament (PAC), that the bond was transacted in US dollars, the Finance Minister came to contradict the BOG deputy governor to the effect that the bond was transacted in cedis.
  7. The Finance Minister failed to disclose that, at 19.75%, Ghana will be paying a whopping $444m every single year as debt servicing (interest), and ceteris paribus, this will continue for the next 15yrs totaling an atrocious US$6.66billion. Do not forget that, upon maturity in 15yrs time, Ghana will have pay back the principal sum of US$2.25billion.
  8. The Finance Minister also failed to tell us why a single email was used as the conduit of notifying the public on the commencement of trading in these bonds……The 7 year as well as the 15yr bonds.
  9. Assuming without admitting that this is so, the NPP government through the Finance Minister again failed to disclose to Parliament who actually received this single most important email at the Bank of Ghana and when was action taken on it so much so that, an emailed sent after 5pm 30th March activated a transaction in the colossal sum of $2.25b by 9am in the morning of 31st March 2017 and concluded same by close of business 31st March 2017.

Meanwhile, Finance Minister has chastised the minority in parliament of scaring away investors, following their insistence that the $2.25billion bond issued by government was done in secrecy.

The Minority at a press briefing on April 18, accused government of wrongdoing in the issuance of the bond, accusing Mr. Ofori-Atta of conflict of interest and insider trading.

According to the opposition National Democratic Congress (NDC) legislators, Franklin Templeton Investment Limited, which acquired about 95percent of the domestic bond, has a direct relationship with Enterprise Group—a company Mr. Ofori-Atta has an interest in.

Mr. Ofori-Atta, however, repudiated the accusations as baseless and appearing before parliament Wednesday to answer questions on circumstances leading to the issuance of the controversial bond, chastised the opposition lawmakers, warning that their actions will scare prospective investors.

Hitherto to Mr. Ofori-Atta’s warning, some financial analysts, including the President of the Ghana Bankers Association, Alhassan Andani, warned the minority’s crusade will dampen investor confidence and that will result in lower returns in future bond issuance.

“They are huge companies with wide international reputations and therefore we have to be extremely careful if we are making any comment that’s going to impugn wrongdoing to especially the people we will go to, to raise capital at any point in time” he cautioned in an interview with Starr News’ Ibrahim Alhassan in April.

But the NDC legislator for Bawku Central, Mahama Ayariga, disagreed arguing that their crusade, will do exactly the opposite of what the analysts, including Mr. Ofori-Atta are positing.

According to him, the quest for more transparency in the deal, will rather engender confidence in the investor community.

“I don’t think so. I think that it will rather strengthen the credentials of the country and make people who deal with us more confident that no wrongdoing will be tolerated by the people of this country that full accountability will be required of the leaders that act on our behalf when they as private investors engage with them.”

The Minority at a briefing conference, following the issuance of the bond, accused government of wrongdoing and Mr. Ofori-Atta of conflict of interest and insider trading.

The Minority triggered Mr. Ofori-Atta’s appearance before parliament to disclose the circumstances leading to the issuance of the bond.

Responding to the Minority’s claim in an hour long address, Mr. Ofori-Atta, explicitly stated that nothing illicit or untoward occurred in the transaction.

“It may be tempting to say that the apparent attempt to manufacture some form of integrity deficit in the process is generally borne of out a lack of understanding of the actual process on the part of the minority,” he said.

He added: “All prospective bidders, bid through their primary dealers, who in turn submitted the investor’s bids through the Central Securities Depository platform. The joint transaction advisers then collate these bids to build up a book on which the bonds are issued.

“At no time during the book building process did the Ministry of Finance negotiate with any investor in any way, and it will indeed be quite difficult to manipulate the process when the three financial institutions are governed strictly by the Bank of Ghana’s rules and regulations.”

“There were no breaches of integrity either on government’s part or on the joint book runner’s part,” he emphasized.

On that note, he advised the Minority against making further negative commentary on issuance of the bond as it deters investors saying “we must appreciate and recognize the potential disastrous consequences some of the discussions on air about this bond will have on investor confidence in our country as a safe haven for investment and growth.”

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