Minister-designate for Finance, Ken Ofori-Atta, has justified the exclusion of the costs incurred in the financial sector clean-up exercise and the mounting debts in the energy sector from the calculation of the nation’s total public debt stock.
Addressing the issue raised by the Appointments Committee of Parliament, the Finance Minister-designate noted government is yet to know and fully account for the total costs incurred in the financial sector clean-up exercise and the energy sector.
According to Mr Ofori-Atta, government is close to the completion of financing costs incurred in the clean-up exercise and that by the end of the third quarter of 2021, government should be able to know the total costs incurred and be added to the nation’s total debt stock.
“We have told the international community that, the financial and energy sector costs is a special event and until we know the full cost of it, we are not going to add them to the nation’s total debt stock and as I said earlier, we are at the point where are finding the true costs incurred and when that is known it will be disclosed and added to the national debt stock,” stated Mr Ofori-Atta.
Government has severally been criticised by analysts in the country for excluding exceptional costs incurred in the financial and energy sectors to the nation’s debt stock.
The approach taken by government in its debt stock calculation, former Minister for Finance, Seth Terkper, has argued does not follow internationally accepted standards.
Ghana’s total debt stock currently stands at Ghs 292 billion, representing 76.1 percent of Gross Domestic Product (GDP) excluding financial and energy sector costs. When added, Ghana’s total debt stock exceeds 80 percent of GDP, making the country at risk of high debt-distress.
