The Director of Research at the Danquah Institute, Dr Frank Bannor has stated that Ghana’s public debt increased more significantly under the governance of the National Democratic Congress (NDC) than it has under the administration of the New Patriotic Party (NPP).
At a press briefing, Dr. Bannor reported that the National Democratic Congress (NDC), during their governance period from 2009 to 2016, increased Ghana’s public debt substantially more than the current administration under the New Patriotic Party (NPP).
He explained that governments typically borrow to manage the shortfall between projected annual revenues and actual cash flows, with these gaps covered by short-term debt instruments.
This borrowing strategy, he said, shifted significantly post-Ghana’s completion of the Highly Indebted Poor Countries (HIPC) Initiative and subsequent external debt relief.
Dr. Bannor pointed out that Ghana’s public debt was manageable at $8.07 billion in 2008, but by 2016 had escalated to $29.2 billion.
This marks a growth of over 261%, pushing the debt-to-GDP ratio from a modest 32% at the end of 2008 to 73.1% by 2016.
According to him, his rate of increase suggests the NDC added an average of 32.75% to Ghana’s debt stock annually between 2009 to 2016.
Dr. Bannor also noted the use of the US dollar for these calculations, citing its role as the primary reserve currency globally and its stability as a unit of account.
He further warned of the risks associated with foreign currency debt, which could increase the debt stock in local currency terms even without new borrowing.
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Source: Anthony Sasu Ayisadu/ATLFMNEWS
