Ghana’s Finance Minister revealed the country faces significant debt service costs, projecting $8.7 billion over the next four years, with heavy liabilities in 2027 and 2028. The lack of financial buffers to manage this debt burden raises concerns, as the nation recovers from a significant economic crisis. President Mahama is focused on economic stabilization and job creation amidst these challenges.
Ghana’s Finance Minister Cassiel Ato Baah Forson indicated that the country is confronted with formidable external debt service obligations over the next four years. Specifically, he projected that Ghana would need to pay $8.7 billion, equivalent to 10.9% of GDP, highlighting that the years 2027 and 2028 will bear the most significant financial burden, with payments of $2.5 billion and $2.4 billion, respectively.
Despite the looming debt service demands, Minister Forson expressed concern that no financial buffers have been established to mitigate this extensive debt obligation. Ghana is currently recovering from a major economic crisis linked to the COVID-19 pandemic, the conflict in Ukraine, rising global interest rates, and prolonged periods of excessive borrowing.
Since assuming office in January as President, John Dramani Mahama has committed to revitalizing Ghana’s economy and addressing job creation amidst these economic challenges. He is dealing with the repercussions of an ongoing cost-of-living crisis, efforts from the International Monetary Fund for a bailout, as well as the implications of a sovereign debt default in a nation that is heavily reliant on cocoa and gold production.
In conclusion, Ghana is poised to face significant external debt obligations amounting to $8.7 billion over the next four years. The projections for the years 2027 and 2028 reveal particularly heavy payments, underscoring the lack of financial buffers. President Mahama’s administration is tasked with addressing the economic fallout from multiple crises while striving to stabilize and boost the economy.
Original Source: www.cnbcafrica.com
