Ghana’s debt stock much more than GHS291.6 billion – Adongo disputes government’s claims

Ghana’s debt stock much more than GHS291.6 billion – Adongo disputes government’s claims

The deputy Ranking Member on Parliament’s Finance Committee, Isaac Adongo has said the 2021 budget was not candid in indicating how much debt the country had accrued.

According to him, the debt stock of GH¢291.6 billion stated in the budget excluded several components such as the IMF facility that the government took to fight the COVID-19 pandemic in 2020.

Speaking on The Point of View on Monday, he said, the Bank of Ghana and the Ministry of Finance were defining the country’s debt stock in a very narrow manner that did not reflect the true situation.

“The Bank of Ghana has a narrow view of our public debt… It is only the debt that goes through the Bank of Ghana that the Bank of Ghana is aware of. Public debt such as the one sitting at the GETFund, the over $1.5 billion, the Bank of Ghana does not know about it…So how come the Ministry of Finance always agrees with the narrow view [of the Bank of Ghana]… Conspicuously missing [from the budget] are the financial commitments that we borrowed under COVID,” he said.

In the 2021 Budget Statement and Economic Policy delivered before parliament on Friday, March 12, 2021 by the Minister for Parliamentary Affairs, Osei Kyei Mensah Bonsu, the government said the country’s current debt stock was GH¢ 291.6 billion.

“The total public debt has increased from GH¢122 billion, which is 69% of GDP to GH¢291.6 billion, which is 76.1% of GDP, as of the end of December 2020… Included in the debt stock and the debt to GDP ratio are the following non-recurrent burdens that we had to deal with as a matter of urgency; the physical impact of COVID-19, which is GH¢19.7 billion, the cost of the financial sector clean-up, which is GH¢21 billion, and the cost of excess capacity charges paid to IPPs, which is also GH¢12 billion,” the minister read.

But Adongo, also the Member of Parliament for Bolgantanga Central challenged the figure on The Point of View on Monday.

He noted that adding all the new commitments the government had made and how much had been spent in 2020, the country’s public debt stock should be in excess of GH¢299 billion

This is not the first time Mr. Adongo is raising concerns about the country’s debt stock.

In 2020, he indicated that the Akufo-Addo government was retrogressing the country by plunging it into a serious debt situation.

He said on average, the government was adding about GH¢ 3 billion in debt each month.

“The NDC was adding an average of GHS1.15 billion to our public debt every month and a total of GHS13billion a year but President Nana Addo Dankwa Akufo-Addo is adding GHS3billion every month and GHS36billion a year and quite clearly, the numbers are showing a very scary picture,” he said at a public forum organized by the Coalition For Restoration (CFR) assess the Akufo-Addo government performance after three years.