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…Just take a moment and patiently read this. It affects you and your Children
Kenbond facility was for $2.25b. This is equivalent conservatively to GHS10b at an exchange rate of $1 : GHS4. We are required to pay 19.5% interest per annum on the cedi bond. 19.5% of GHS10b is GHS1.95b every year. GHS1.95b assuming the cedi remains at $1 : GHS4. It means the dollar equivalent interest rate on Kenbond will be $487m a year. Annual interest payments over 15 years alone will amount to $7.3b. And after 15 years we are supposed to make a single bullet payment of the principal amount of $2.25b. All this is assuming that the cedi will remain at $1 : GHS4 over the next 15 years. This is highly unlikely. Interest payment would be even higher as the Cedi loses ground to the dollar.
$7.3b + $2,25b = $9.55b
So Templeton is going to make $9.55b by the end of the bond period on an investment of $2.25b.
A straight dollar bond would have attracted an interest rate of around 10% much lower than 19.5% on a dollar indexed cedi bond.
How can we be so wicked to our country! The hypocrisy in NPP’s accusations against Mahama for borrowing for infrastructure development is so galling!
Source: Ohenenana Obonti Krow