Ghana’s debt stock skyrockets from GH¢9 billion to GH¢402.4 billion – BoG

BoG Governor, Dr Ernest Addison (right), Finance Minister Ken Ofori-Atta (left)

The October 2022 Bank of Ghana (BoG) Summary of Economic and Financial Data has revealed that Ghana’s public debt stock went from GH¢9 billion to GH¢402.4 billion as of July 2022.

This, according to the central bank, is equivalent to 68% of the Gross Domestic Product and is in sharp contrast to the projected 104.6% of debt to GDP ratio in 2022 by the World Bank.

In dollar terms, the country’s debt dropped marginally to $53.2 billion in July 2022, from $54.4 billion in June 2022.

Based on the data, the nation did not borrow fresh funds from the international market during the period. However, the debt level will go up going forward, following the $750 million Afrieximbank loan that came in August 2022.

According to the data, the external debt remained largely unchanged at $28 billion, equivalent to 35.8% of GDP.

The domestic debt however has been going up since January 2022 because of the significant borrowing by the government in the domestic financial market.

The domestic debt stood at GH¢190.3 billion in July 2022, from GH¢190.1 billion in June 2022.

Data available shows that the domestic debt began the year at GH¢181.9 billion in January 2022 and then went up to GH¢185.4 billion in February 2022 and ¢190.1 billion in March 2022. It subsequently shot up to GH¢189.2 in April 2022 and GH¢188.5 billion in May 2022.

On the other hand, the financial sector resolution bond fell by GH¢100 million to GH¢14.4 billion in July 2022. This is equivalent to 2.4% of GDP.

The total public debt stock of the country dropped to GH¢388.1 billion in April 2022, from GH¢392.1 billion in March 2022. It later went up marginally to GH¢389.2 billion in May 2022 and subsequently to GH¢393.4 billion in June 2022.

Meanwhile, the World Bank in its latest Africa Pulse Report classified Ghana as a high debt distress country as it projects the nation’s debt to Gross Domestic Product (GDP) of 104.6% by the end of 2022.

According to the report, debt is expected to jump significantly, from 76.6% a year earlier, amid a widened government deficit, massive weakening of the cedi, and rising debt service costs.