The National Communications Officer of the National Democratic Congress (NDC) Sammy Gyamfi, has reiterated the position of the Presidential Candidate of the party, John Mahama, that Ghana is back in extreme debt unsustainability levels usually dubbed “HIPC”.
At a press conference in Accra today, Sammy Gyamfi, drummed on the available data to support the party’s position that Ghana is not only in the Highly Indebted Poor Country regions with a debt to GDP ratio projected to hit 76.7% by the end of the year, but that Ghana is financially in a worse state now than it was when it first went for the Highly Indebted Poor Country (HIPC) program in 2001.
According to the NDC spokesman, the situation now is so bad that every Ghanaian now owes a whopping Ghc10,000 (100million old cedis) if the country’s debt were to be split among its 30 million inhabitants.
Ghana’s public debt stands at some GHC 260 billion currently, with the Akufo Addo administration accumulating almost GHC 160 billion of this debt. Essentially, the government had racked up some GHC 304,000 in debt every minute of its four-year term
“What this means is that, President Akufo Addo has added more debt, i.e. a whopping GHS138 billion and still counting, to Ghana’s Public debt in only three (3) and half years, far more than any government has done in the history of this country, and far more than all successive governments since independence, have cumulatively added to the country’s Public debt. In fact, per our current total Public debt of GHS258.8 billion (i.e. as at June 2020), every Ghanaian in Ghana today is indebted to the tune of about GHS10,000,” Sammy Gyamfi reiterated.
“Indeed, our current debt position, is worse than where we were when we joined the HIPC debt relief program in the year 2001, at which time our debt to GDP ratio stood at 61%.”
“So bad is our current debt position that our finance minister, Ken Ofori Atta, at the virtual plenary session of the Development Committee (DC) of the World Bank (WB) and International Monetary Fund (IMF) last Friday, pleaded for debt forgiveness for the country,” Mr. Gyamfi charged.#
At the plenary session in question, Mr. Ofori-Atta actually begged for Ghana and other African countries to be forgiven their debt because they are in no position to pay back what they borrowed.
A heated debate had ensured in the past few days when the International Monetary Fund (IMF) released a report that projected that Ghana will dangerously his a 76% debt to GDP ratio by the close of this year. That range essentially places the country squarely in the debt unsustainability threshold.
Critics have therefore posited that Ghana had ventured into a HIPC status, but the Akufo Addo government had vehemently denied this, claiming the IMF has not officially declared Ghana HIPC.
As part of the government’s defense, it has said that high debt is no news and that countries like Japan and France also have high debts.
However, Sammy Gyamfi pointed out that the NPP is now singing a different tune in power after it had criticized the Mahama government over debt even though the Mahama government had done far better than the current government in terms of the management of debt.
“You may recall, that in the run up to the 2016 general elections, the New Patriotic Party (NPP), led by its over-hyped economic messiah, Dr. Alhaji Mahamudu Bawumia and then Candidate Akufo Addo, berated the NDC for what they described as excessive borrowing by the Mahama government. The “NPP led by Dr. Bawumia, described Ghana’s debt position at the time, as unsustainable, and went on to describe the country as a “Highly Indebted Lower Middle Income Country (HIMIC)”.
Meanwhile, the NDC has dismissed the attempt by the Akufo Addo administration to blame Covid-19 for the debt conundrum, saying it does not wash because even before Covid struck, the country’s debt to GDP had already ballooned to 63%.
At that rate, Ghana had breached the debt unsustainability range, requiring urgent debt relief measures.