• Ghana’s public debt stock has witnessed an increase yet again
• Dr Asuming believes government must not get carried away despite a slow-down in terms of the cedi to dollar equivalent
• The country’s public debt stock has hit GH¢336 billion with a debt-to-GDP ratio now pegged at 76.4%
An Economist and lecturer at the University of Ghana-Legon, Dr. Patrick Asuming has advised government to remain cautious in driving down the debt stock in terms of the cedi to dollar equivalent.
Back in May 2021, the US dollar equivalent of Ghana’s debt hit US$57.9 billion and later rose to US$58.1 billion in June for the same period. But recent figures released by the Bank of Ghana showed a decrease in the debt to US$57.9 billion for July 2021.
In an interaction with Citi Business News, Dr Asuming explained that despite a slow-down in the rate of increase in terms of the cedi to the dollar equivalent, government must remain cautious and not get carried away.
“It’s good that there has been some slowdown, but I don’t think we should not get carried away. Our situation hasn’t really changed much from the last reading. I do really think that, that in itself, is the problem. The problem is, while we have been piling up the debt, we really don’t have much to show for it,” he pointed.
Dr Asuming added, “even though we are recovering, the economy hasn’t been at its strongest. Also, in the last couple of months, the cedi has depreciated a little bit even though the dollar value looks smaller. It is obvious because we are repaying but because the currency has lost value, if you convert it to cedi, it looks like in cedi terms, it is higher.”
His comments come after recent figures released by the Bank of Ghana showed an increase in the public debt stock increased by GH¢3.5 billion in just two months, making the total debt stock GH¢332 billion in May 2021 to about GH¢336 billion in July 2021.
Also, Ghana’s debt-to-Gross Domestic Product ratio, according to the central bank is now pegged at 76.4%.