Ghana’s public debt stock has risen further to GH¢575.7billion according to the Bank of Ghana’s January 2023 Summary of Economic and Financial Data.
This latest rise in the debt burden represents 93.5% of Ghana’s Gross Domestic Product (GDP)
The data reveals that the country’s debt stock increased by ¢108.3 billion between September and November 2021.
The external component of Ghana’s total public debt reached $29.2 billion (¢382.7 billion) in November 2022, equivalent to 62.1% of GDP.
This is an increase from $28.4 billion (¢271.7 billion) in September 2022, and $28.3 billion in December 2021.
The significant increase in the cedi component of the external debt is attributed to a 37% depreciation of the cedi to the dollar in 2022.
On the domestic side the debt stood at ¢194.7 billion at the end of December 2022, which represents 31.6% of GDP.
This is compared to ¢195.7 billion recorded in September 2022, and ¢193.1 billion in November 2022.
The government plans to restructure around ¢170 billion of the domestic debt for a period of 12 years.
It is observed that the data does not include debt accrued from financial sector clean-up as well as other liabilities such as energy sector debt. Government’s fiscal deficit to GDP stood at 9.8% in November 2022, up from 7.4% recorded in September 2022.
The World Bank has projected a debt-to-GDP ratio of 99.7% for Ghana in 2023 and 101.8% in 2024. The bank has also classified Ghana as a high debt distress country, estimating the nation’s debt to GDP to reach 104.6% by the end of 2022.
Ghana has been compelled to restructure its debt as part of efforts to revive the economy which currently is due for support from the International Monetary Fund (IMF).
The country’s Domestic Debt Exchange Programme launched on December 5, 2022, suffered initial setbacks as creditors were slow in responding to persuasion from the Ministry of Finance to exchange their current bonds for new, significantly lower value, versions.