Ghana’s debt crosses GHS300 bn mark as debt-to-GDP ratio drops to 70.2%

Ghana’s total public debt stock has increased once again according to new data released by the Bank of Ghana.

The debt stock which ended 2020 at GHS291.6 billion, saw about GHS13 billion being added in the first quarter of 2021.

This represents an increase of about 4 percent, and brings Ghana’s total public debt as of the end of March 2021 to GHS 304.6 billion.

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The new debt figure brings Ghana’s debt to Gross Domestic Product (GDP) ratio to 70.2% as of the end of March 2021.

This is lower than the debt to GDP ratio of 76.1% recorded at the end of 2020 according to data from the Central Bank.

The reduced debt to GDP ratio despite an increase in the overall debt figure, can be attributed to the projected GDP figure of GHS433.6 billion for the year 2021.

The new GDP figure represents an increase of about 13% over the GDP figure for 2020 which stood at GHS383.3 billion.

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A breakdown of the debt numbers shows that the component of the debt secured outside the country remained relatively stable in the first quarter even dropping marginally to GHS141 billion in March, from the GHS142.5 billion recorded in January and February of this year.

The external debt component as of the end of March 2021 made up 32.5 % of the total value of the economy which is projected to be about GHS434 billion for 2021.

On the other hand, the component of the debt secured locally increased steadily in the first 3 months of 2021. That is an increase of about GHS 14 billion from January to March this year, bringing total domestic debt to GHS163.6 billion at the end of the period under review, representing 37.7 per cent of the projected GDP for 2021.

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The domestic component of the total public debt contains the financial sector resolution bond which was GHS15.2 billion as of the end of March 2021.

Source: Citinewsroom