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ACCRA, May 23 (Reuters) - Ghana's cabinet has approved aEurobond issue of up to $1 billion tentatively scheduled forJuly, Finance Minister Seth Terkper said on Thursday.
"Based on anticipated market conditions and financing needs,a transaction size of up to $1 billion was recommended to, andapproved by, cabinet," Terkper told reporters, adding thatCitigroup and Barclays had been appointed leadmanagers on the deal.
He also named Accra-based Ecobank Development Corporationand Strategic African Securities as co-managers of the bond,which the government said would be used for capital expendituresand refinancing public debt to reduce cost of borrowing.
Terkper said the government was considering additionalmeasures including tax hikes and regular adjustment in utilityprices to boost revenue for the year after provisional datashowed shortfalls in first quarter revenue target.
The government would also review the implementation of apublic sector pay package which has taken a huge toll on theeconomy, he said, adding that the current size of the wage billwhich takes up 60 percent of the total national budget was"unsustainable".
"We have come to a point where we cannot continue at thecurrent pace," Terkper said. "It is not only unsustainable butit is also creating distortions within the public sector wages."
