Public Debt Stock Rises Above GH¢ 350 bn By Dec. 2021; More Than 80% Of GDP

Latest data released by the Bank of Ghana puts Ghana’s total public debt stock as at December, 2021, at US$ 58.6 billion or GH¢351.8 billion. The amount is equivalent to 80.1% of Ghana’s Gross Domestic Product, the highest level recorded in recent history.

In Cedi terms, the total debt stock increased by about GH¢7.3 billion from GH¢344.5 billion in November to the GH¢351.8 recorded in December. In Dollar terms however the debt increased by about US$400 million from the US$58.2 billion recorded in November to the US$58.6 billion recorded in December 2021.

A look at the data from the Central bank shows that year-on-year, from December 2020 to December 2021, the debt stock rose by about 20% from GH¢291.6 billion to GH¢351.8 or an addition of about GH¢ 60 billion within that 12 month period.A further breakdown of the debt numbers show that the component of debt secured locally rose by about 21% between the period of December 2020 to December 2021, from GH¢ 149.8 billion to GH¢ 181.8 billion.

The external component of the debt, in Cedi terms also rose by about 20% between the period of December 2020 to December 2021, from GH¢141.8 billion to GH¢170 billion. In dollar terms however, the increase in debt was about 14.5%, from US$24.7 billion in December 2020 to US$28.3 in December 2021.

The rise in public debt has led to concerns about debt sustainability and the ability of the country to access the International Capital Market for more support.

Ratings agency Fitch recently downgraded Ghana to B negative, with a negative outlook, following a pandemic-related surge in government debt, and uncertainty about the government’s ability to stabilize debt against a backdrop of tightening global financing conditions.