Member of Parliament for Bolgatanga Central Constituency, Isaac Adongo has expressed worry over the rising levels of the country’s public debt stock stating that the country is currently in a debt distress state.
According to the NDC MP, contrary to claims by the World Bank that Ghana is at a high risk of debt distress, the latest assessment by the Economic Intelligence Unit (EIU) shows that the country is actually in a debt distress state as it is unable to service its matured debt owed external creditors.
Describing the economic situation of the country as frightening, Mr. Adongo opined that government’s intention to raise US$5 billion from the international capital market to support the 2021 budget will worsen the debt situation in the country.
“Ghana is no longer at risk of debt distress as claimed by the World Bank, we are actually in debt distress as we have defaulted and cannot pay maturing loans owed to official external creditors and are now accumulating arrears of unpaid official external debts under.
Ghana now facing frightening rising fiscal risks, external vulnerabilities and in debt distress but still looking to do $5 billion junk Eurobonds in 2021 under Dr. Bawumia,” the Bolgatanga Central legislator stated.
In a 25-page document assessing the political and economic situation in the country, the Economic Intelligence Unit indicated that “the country is currently estimated to be in default, following a rise in principal arrears owed to external official creditors in 2018. Arrears will remain substantial, raising the perceived risk of a prolonged default among investors”.
The EIU also predicted a win for the NDC in the 2024 elections even though it expects the party to dump its 2020 presidential candidate, John Dramani Mahama, who is reportedly considering to run again for the presidency, for a new candidate so as to “revitalize its prospects”.
In October last year, the World Bank predicted a significant rise in Ghana’s total public debt due to a widening fiscal deficit resulting from low revenue generation and high expenditure brought about by the Covid-19 pandemic.
It had, however, maintained that Ghana is a high risk debt distress country.
