The Bretton Wood Institution (World Bank) in its October 2020 Africa Pulse Report, has projected a rise in Ghana’s public debt stock.
The World Bank in its report, projected a significant rise in the debt stock before the end of 2020, mainly attributing the increase in the debt stock to the widening fiscal deficit as a result of lower revenue and high expenditure brought about by Covid-19.
The country’s debt stock currently stands at Ghs 263 billion, representing some 68.3 per cent of the Gross Domestic Product (GDP).
The external component of the Ghs 263 billion debt is estimated to be Ghs 138 billion ($24.3 billion), representing 35.8 percent of GDP whereas the domestic component of the debt is also estimated to be Ghs 125.1 billion, approximately 32.5 per cent of GDP.
The World Bank in its report, stated that debt sustainability post-COVID-19 will depend on the ability of Sub-Saharan African countries to alleviate their mounting debt burdens and create increased fiscal space.
It emphasized that creating fiscal space will help the economy cushion the effects of the pandemic crisis and avoid a deeper recession.
But according to the recently held 96th Monetary Policy Committee (MPC) press briefing, Ghana’s fiscal deficit increased by 0.2 per cent above the revised 7.2 per cent fiscal deficit on the back of the coronavirus pandemic.
