Ghana’s Finance Minister announced that the country will owe $8.7 billion in external debt service over the next four years, impacting 10.9% of GDP, particularly in 2027 and 2028. The government has not set aside buffers for this burden amid ongoing economic recovery efforts following a significant crisis.
Ghana’s Finance Minister, Cassiel Ato Baah Forson, reported on March 11 that the country will incur substantial external debt service costs exceeding $8.7 billion in the upcoming four years. This figure represents 10.9% of Ghana’s GDP, with a significant concentration of payments due in 2027 and 2028, specifically $2.5 billion and $2.4 billion, respectively.
Forson noted that despite these looming obligations, Ghana has not established any buffers to mitigate the impact of this substantial debt service burden. The nation is recovering from a severe economic crisis exacerbated by the COVID-19 pandemic, the Ukraine war, increased global interest rates, and prolonged high borrowing.
President John Dramani Mahama, who assumed office in January, is committed to revitalizing the economy and creating job opportunities. However, he must also address the repercussions of a soaring cost of living, an ongoing bailout from the International Monetary Fund, and the ramifications of a sovereign debt default in this cocoa and gold-producing country.
Ghana faces a challenging financial landscape with significant external debt service obligations projected at $8.7 billion over four years. The concentration of payments in 2027 and 2028 highlights the urgency for economic recovery strategies. With ongoing commitments from the IMF and rising living costs, the financial stability and economic growth remain critical for the new administration under President Mahama.
Original Source: www.cnbcafrica.com
