At the end of September 2019, Ghana’s debt stock stood at GH¢208.6 billion.
This was contained in the November Bank of Ghana’s summary of financial and economic data released after the Monetary Policy Committee met this week to review the “health” of the economy.
Breakdown
The GH¢208.6 billion total debt stock puts the country’s debt-to-GDP ratio at 60.3 per cent ending September. It is noteworthy that GH¢107.2 billion of the debt came from loans taken from outside the country by government, which is about $20.1 billion. This constitutes about 31.1 per cent of the total value of the economy.
Domestic debt stands at GH¢101.4 billion, representing 29.4 per cent of the total value of the economy.
The latest figure from the bank represents an increment of GH¢3.1 billion compared to the July debt stock of GH¢205.5 billion. However, when you look at the year-on-year from September 2018 to September 2019, it went up by GH¢37.8 billion.
Reasons for the debt stock increase?
The increase in the debt stock over the past two months can be attributed to the cedi’s marginal depreciation and recent funds advanced towards the clean-up of the banking and non-banking sectors of the economy.
The data shows that the domestic debt component, from July 2019 to September 2019, went up from GH¢98 billion to GH¢101.4 billion.
Based on estimates outlined in the 2019 Supplementary Budget, the total cost of the financial sector clean-up could reach GH¢21 billion by the end of 2019.
This was after the Finance Minister, Ken Ofori-Atta, projected in the budget that the clean-up could reach $3 to $4 billion by the end of 2019.
In the 2020 Budget presentation, the Finance Minister updated the numbers. He noted that the total estimated cost for the government’s fiscal intervention, excluding interest payments from 2017 to 2019 was estimated at GH¢16.4 billion.
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