Finance Economist at the University of Cape Coast School of Business, Prof. John Gatsi has raised a red flag on what he describes as the seeming silence of the opposition National Democratic Congress (NDC) over the rising public debt of the country.
According to him in an article published on AwakeNewsRoom.com, “The NDC, in particular, owes it as a duty to the public to make the subject “public debt” an important agenda because it has implications for her 2024 policies and implementation strategy when the NDC wins the elections.”
Prof. Gatsi explained that “In the era of bonds, where we believe elongated maturity is a good debt management strategy, politically it means another party will face the harsh repayment realities that may disable the implementation of forward-looking programs.”
“It is therefore difficult when the opposition political parties don’t speak consistently about debt stocks, public debt transparency and accountability, and above all whether or not public debt management reflects asset creation for the country.” – he added
For him, “The reality is, no matter how acceptable the policies of a political party are, the implementation may be affected by the debt trap inherited.”
He noted that “Public debt accumulation is not a matter only for today, but also for the future. The truth is in a multiparty democracy, where a party that forms a government today after a clean election, is bound to change at one of the future elections, which means political parties must be interested in public debt management.”
Prof. Gatsi’s concern is incoming in the wake of reports that Ghana’s public debt stock shot up by ¢27.8 billion in April 2021 and May 2021 to ¢332.4 billion, the latest Summary of Economic and Financial Data by the Bank of Ghana has revealed. This is equivalent to $57.9 billion, about 76.66 percent of Gross Domestic Product.
In December 2016, Ghana’s debt was GHS122, representing about 62% of GDP. This was based on the old economic value of the country. However, at the end of September 2019, Ghana’s public debt had risen to about GHS208. 6 billion, representing 60.3% of GDP due to the rebasing of the Ghanaian economy.