Dr. Cassiel Ato Forson, Ghana’s Finance Minister, detailed the country’s impending debt payments, including over GH¢150 billion in domestic obligations and $8.7 billion in external debts due over the next four years. He highlighted significant payment peaks in 2027 and 2028 and reassured citizens of the government’s commitment to economic reform despite these challenges.
In a recent presentation regarding the 2025 Budget and Economic Policy, Finance Minister Dr. Cassiel Ato Forson outlined the significant debts Ghana will be obligated to pay over the next four years as a consequence of debt restructuring implemented by the government led by President Nana Addo Dankwa Akufo-Addo. The analysis detailed both domestic and external debt figures, highlighting substantial financial burdens scheduled for the upcoming years.
According to Dr. Ato Forson, Ghana will incur over GH¢150 billion in domestic debt payments from 2027 to 2028 due to the Domestic Debt Exchange Programme (DDEP) initiated by the Akufo-Addo administration. The Minister noted that this amount represents 11.6% of the country’s GDP, with 73.3% of these obligations concentrated in 2027 and 2028. He warned that the debt service obligations for these years pose a serious economic risk.
The minister remarked on the immediate challenges faced this financial year, highlighting significant payment peaks in February (GH¢9.9 billion), July (GH¢6.2 billion), and August (GH¢10.1 billion). Moreover, Dr. Ato Forson disclosed that Ghana’s external debt obligations would exceed $8.7 billion over the next four years, equating to 10.9% of GDP, with most of it due in 2027 and 2028.
A substantial 55% of the total external debt service is scheduled for repayment during the critical two years, with US$2.5 billion due in 2027 and US$2.4 billion in 2028. Dr. Forson described these years as particularly burdened with debt resulting from the previous administration’s actions. He assured the Ghanaian populace that the current government is prepared to confront these challenges head-on and work towards economic transformation.
In reference to the DDEP, former Finance Minister Ken Ofori-Atta announced various measures in December 2022 to address the country’s debt sustainability. The program involved exchanging existing domestic bonds with new ones, with different maturity dates and coupon payment terms. This included a commitment of 0% interest in 2023, 5% in 2024, and 10% in 2025, continuing until maturity, thus providing a framework for managing the domestic debt.
Following the domestic debt restructuring measures, efforts were made to similarly address Ghana’s external debt challenges, marking a comprehensive strategy implemented by the government to manage national financial obligations effectively.
In conclusion, Ghana faces significant domestic and external debt repayments over the next four years, primarily due to restructuring efforts set forth by the previous administration. The looming obligation of over GH¢150 billion in domestic bills and more than $8.7 billion in external debts presents a considerable challenge for the nation. However, the current government remains committed to addressing these financial hurdles and is optimistic about transforming the economic landscape for the better.
Original Source: www.ghanaweb.com
