Unprecedented: Mills takes Ghana’s debt to GH¢25.3bn

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Category: Elections & Governance

Created on Wednesday, 18 April 2012 00:00

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Unprecedented: Mills takes Ghana’s debt to GH¢25.3bn

In less than four years of assuming the reins of governance, President John Evans Atta-Mills and his ruling National Democratic Congress administration have increased Ghana’s total public debt stock from GH¢8.8 billion in 2008 to GH¢25.3 billion as at February 2012.

This situation represents a 187.5% increase over the 2008 total public debt level bequeathed to the Mills-Mahama administration by the John Agyekum Kufuor led New Patriotic Party administration.

The governor of the Bank of Ghana, K.B Amissah-Arthur, made this known after the Monetary Policy Committee met last week, during its 50th meeting, to deliberate on recent developments in the economy and assess risks to the inflation and growth outlook.

Mr Amissah-Arthur revealed that the stock of Ghana’s domestic debt went up by 6.7 per cent in the first two months of 2012 to GH¢12.6 billion, whilst the external debt stock declined marginally by 3.3 per cent, from US$7.8 billion at the end of December 2011 to US$7.6 billion at the end of February 2012.

“Cumulatively, total public debt stock is estimated at GH¢25.3 billion at end February 2012, up from GH¢24 billion recorded at the end of December 2011. As a ratio of GDP, the total public debt increased to 43 per cent of GDP at the end of February 2012, from 42.6 per cent of GDP at the end of December 2011”, Mr Amissah-Arthur said.

By the governor’s statement, in less than four years of assuming the reins of power, President John Evans Atta-Mills has achieved an unprecedented feat in raising up Ghana’s total public debt stock to an unprecedented level, a feat achieved by no President in the history of Ghana.

This development has led to many pundits and economic analysts wondering what projects these excessive loans that have been contracted by President Mills and his ruling NDC have used the money for, as there are no visible projects to be seen.

It is recalled that as at 2000, the stock of public debt as left by the Rawlings led NDC administration stood at $7.5 billion.

The stock of domestic debt (gross) stood at GH¢4,778.1 million (27.8 percent of GDP) at the end of 2008, up from GH¢3,708.2 million (26.5 percent of GDP) in 2007.

External debt stood at US$3,982.6 million (28.1 percent of GDP) at the end 2008, up from US$3,590.4 million (24.9 percent of GDP) in 2007. Thus, total public debt at the end of 2008 stood at the equivalent of US$7,918.1 million (55.9 percent of GDP).

Fiifi Arhin

Source: Statesmanonline.com