MF Rubbishes Ofori-Atta’s Voodoo Economics On Debt To GDP -Corrects that figure is 78% and not 76.1%

The International Monetary Fund (IMF) has called out the voodoo economics of Finance Minister Ken Ofori-Atta for somehow reducing the country’s debt to GDP ratio in 2020 to 76.1% instead of 78%.

After consultations under Article IV between April 28 and May 12, a Mission of the IMF and Finance Ministers, the IMF insists that Ghana’s public debt as a percentage of Gross Domestic Product (GDP) for 2020 was rather 78 percent. 

The IMF mission had been led by Carlo Sdralevich who wrote, “The government deficit, including energy and financial sector costs, reached 15.5 percent of GDP, while annual gross financing needs exceeded 20 percent of GDP. Public debt rose to 78 percent of GDP in 2020, from 64.4 percent in 2019, including ESLA of GH¢7.63 billion in 2020.”

The disparity stems from a difference between the IMF’s application of simple Economics in which all of Ghana’s debt liabilities are added and gauged as a percentage of its GDP, while Ken Ofori-Atta has been applying a particularly dodgy style of accounting in which he leaves out huge debts owed by the country, particularly those from the Energy Sector.

A shrewd Ken Ofori-Atta, would profile Ghana’s debt and leave out energy sector debts which are some of the biggest. Often, he would put these in the footnotes of the budget and report the country’s debt minus these huge figures just to make the government look good.

According to the IMF, in 2020, the energy sector debt that Ofori-Atta had always avoided through tip-toe economics amounted to Ghc7.63billion. 

The IMF Mission’s conclusion vindicates former President Mahama who had pointed out that Ken Ofori-Atta’s penchant for hiding Ghana’s debt in plain sight is an expensive joke.