Osei Kyei-Mensah-Bonsu, the Minister for Parliamentary Affairs and caretaker Minister for Finance, has blamed the country’s ballooning debt stock, among other items, on the effects of the COVID-19 pandemic.
Mr. Kyei-Mensah-Bonsu reported during the presentation of the 2021 budget in Parliament that the provisional debt stock stood at GH291.614 billion, or 76.1 percent of GDP, and that it “included the fiscal effect of COVID-19 – GH19.7 billion, cost of financial sector clean up – GH21 billion, cost of excess capacity charges charged to IPPs – GH12 billion, and the impact of the reduction i.e
“As of the end of December 2020, the provisional debt stock stood at GH291.614 billion, equivalent to 76.1 percent of GDP, compared to GH217.991 billion, equivalent to 62.4 percent of GDP in 2019,” he added.
He also noted that these costs needed to be addressed as soon as possible.
According to Osei Kyei-Mensah-Bonsu, the caretaker Minister of Finance, the total debt stock would have been substantially reduced if expenditures for the COVID-19 pandemic, as well as the banking sector clean-up, were removed from the list.
“With these expenses removed and the decrease in GDP growth in 2020 largely due to the COVID-19 pandemic factored in, the overall stock of debt for 2020 would have been around GH238.9 billion, suggesting a debt to GDP ratio of 58.7%.”
Mr. Kyei-Mensah-Bonsu went on to say that the 2021 budget would ensure economic growth and macroeconomic stability by implementing well-thought-out policies that will re-energize the economy.
He also noted that the COVID-19 pandemic has wreaked havoc on many economies around the world, including Ghana’s, and that the sudden turn of events necessitated swift action to resolve the pandemic’s negative effects on livelihoods.
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SOURCE: ATLFMNEWSONLINE
