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Ghana’s Debt Stock Up Slightly   
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Seth Terkper
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Ghana’s total public debt stock has increased slightly to GH¢38.3 billion 43.2% of Gross Domestic Product (GDP) at end April 2013, from GH¢35.1 billion in December 2012.

Both public and the external debt increased slightly. The stock of domestic debt amounted to GH¢20.3 billion compared to GH¢18.5 billion in December 2012. External debt stood at US$9.5 billion up from US$8.8 billion over the same period.

The Central Bank recently issued a 3 year fixed rate bond at a coupon rate of 19.24 percent to raise an amount of GHC400 million but received bids of GHC786 million. The Central Bank took only GHC489.4 million.

More than 80 percent of the bids received by the Central Bank were coming from offshore investors. The proceeds of the bond were to support government budget, as well as rollover maturing debt.

The Provisional estimates on broad fiscal data show that the government has recorded an overall budget deficit of GHC3.4 billion for the first four months of 2013, which is equivalent to 3.8% of Gross Domestic Product (GDP) against a target of GH¢2.7 billion representing 3% of GDP.

This outturn was on the back of a significant shortfall in revenues with expenditures marginally below target, according to the Governor of the Central Bank Dr. Henry Kofi Wampah.

The deficit was financed mainly from domestic sources, resulting in a Net Domestic Financing (NDF) of GH¢2.7 billion, higher than the budget target of GH¢2.2 billion. Foreign financing of the budget amounted to GH¢687.2 million, also higher than the GH¢482.1 million target.

Total revenue and grants were GH¢6.3 billion, against a target of GH¢7.1 billion. Of this outturn, domestic revenue amounted to GH¢5.9 billion, below the target of GH¢6.4 billion on account of lower tax revenues. Total tax revenue amounted to GH¢4.2 billion, below the target of GH¢4.9 billion.

The low tax revenue collection over the period was the result of lower company profits and lower imports due to the general slowdown in economic activity. Grant disbursements also fell short of target by 38.3 percent, reflecting non-disbursement from the Multi-Donor Budget Support (MDBS) partners.

Non-tax revenues, on the other hand, turned in higher than budgeted at GH¢1.6 billion, compared to the target of GH¢1.5 billion.

Total expenditures, including payments for the clearance of arrears and outstanding commitments amounted to GH¢9.7 billion, lower than the budget target of GH¢9.8 billion. The wage bill amounted to GH¢3 billion, against a target of GH¢2.8 billion. Similarly, interest payments amounted to GH¢1.6 billion, against a target of GH¢1.1 billion.
Source: Economy Times

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