Public debt stock hits ¢170b ending Nov. 2018


The country’s total debt stock has significantly increased by ¢2.9 billion in two months to reach ¢172.9 billion ending November 2018.

The Data from the Central Bank showed that the new debt stock represents 57.9  per cent of the total value of Ghana’s economy otherwise referred to as Debt-to-GDP Ratio by economists.

This could mean that country might have built adequate assets to absorb its rising debt or the economy has expanded in a way to absorb the rising expenditure.

Some economists have also argued that this development was largely influenced by rebasing of the economy by the Ghana Statistical Service.

A breakdown of the debt stock shows that ¢86.3 billion of the debts were secured from outside the county, while ¢86.5 billion were domestic bonds and local borrowings.

Possible reasons for the spike in public debt   

There are no official reasons for now as to what might have accounted for the increase in the debt stock.

However, persons within government say the cedis’ marginal depreciation over the period and some borrowings to help with the restructuring of some banks might have contributed to debt stock going up.

Implications of debt numbers…should we be?

For some economists and analysts, the fact that the economy has expanded as a result of the rebasing shows there is no need to worry. This is because the country might be moving away from the dreaded 70 per cent Debt-to-GDP ratio that could result in  Ghana being classified as a risk of high debt distress country.

This means Rating Agencies might be warning investors that the country might be having problems in paying our debt on time.

However, some have also warned that if these funds that are not being invested in sectors that would pay back for itself in the future, then the country could be sitting on a time bomb.

Government’s borrowing for  2018 and the first quarter of 2019

Government is planning to borrow ¢11 billion for the first three months of 2019. According to the BoG, ¢10.1 billion is for rollover matures, while ¢1.1 billion is to help government meet its financing requirements

2018 borrowings through bonds and Treasury bills

According to the borrowing calendar for 2018, government ended the year taking about ¢45 billion through bonds and treasury bills. Data from the Finance ministry shows that it has already taken ¢22.4 billion in the first half of this year.

From the first quarter numbers, only ¢4.6 billion can be classified as fresh borrowings which were used to meet the government’s financing needs.

The remaining ¢17.8 billion was used to finance debts that were maturing. Also, ¢11.3 billion was taken in the third quarter of this year.

The calendar which captures government’s operations for October to December shows that the Finance Ministry would be borrowing ¢12.8 billion through bonds and treasury bills for the last quarter of this year.

How other sectors of economy fared based on  BoG’s data

The country ended 2018 securing $14 billion as earnings from total exports. Gold brought in about $5.4 billion compared to the $5.7 billion gotten in 2017. Cocoa brought in $2 billion, compared to the $2.6 billion secured in November  2017, while oil in 2017 brought in $3.1 billion.

Ghana Import bill for 2018 and 2017   

The country in 2018 spent $13 billion to finance its imports, compared to the $12.6 billion in 2017. Oil imports accounted for $2.5 billion of this total expenditure on imports. However, in 2017 government just spent $1.9 billion. Non Oil imports stood at $10.5 billion compared to $10.6 billion in 2017.

Looking at the base of these import and export numbers, government ended 2018 with a balance of payment of over $2 billion, compare just about $2 billion last year.


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