It is clear Ghana can only enter the international capital market after 2027 when fiscal prudence and credit rating improve . That is not the same as the domestic capital market or broadly the domestic debt market which includes short-term and long-term instruments.
Issuance of long-term government instruments such as government bonds demands prudence and cautious financial risk management and maintaining creditworthiness of the issuer. There are many practical reasons to gradually open to longer-term government instruments in the domestic debt market instead of reliance on treasury bills with eminent pronounced risks to the economy through pressure on exchange rate and inflation.
Practically, institutional investors such as pension funds, insurance firms , banks etc cannot continue to experience a situation where greater proportions of their funds do not have avenues for investments. This may be a greater risk to the economy and may gradually reduce the confidence when the government slips into accepting treasury bills beyond the requirements. Treasury bill is a benchmark rate but the policy rate is a better sensitive benchmark rate to lending rates hence the need to accommodate gradual long- term instruments to absorb the risk of not diversifying domestic debt market instruments. Government must be conservative , risk averse ,demonstrate prudence and willingness to enhance measures to deepen the market confidence and conditions
It is good risk management to encourage the government to diversify the domestic debt instruments in a cautious manner while maintaining a prudent stance in managing the fiscal situation.
