Ghana’s Finance Minister disclosed the country will incur $8.7 billion in external debt service over the next four years, predominantly in 2027 and 2028. The nation is recovering from a severe economic crisis and lacks sufficient buffers for this debt burden, prompting President Mahama to focus on economic revitalization amidst financial crises.
Ghana’s Finance Minister, Cassiel Ato Baah Forson, indicated in a recent address to Parliament that the nation is confronted with substantial external debt service costs over the next four years. Specifically, Ghana is expected to pay $8.7 billion, which equates to 10.9% of its GDP, with substantial payments anticipated in 2027 and 2028. Forson highlighted that the country will be obligated to pay approximately $2.5 billion in 2027 and $2.4 billion in 2028.
Forson further elaborated on the financial challenges facing Ghana, stating, “In spite of all these upcoming domestic and external debt service obligations, no buffers were built to cushion this unprecedented debt service burden.” The nation is currently emerging from a severe economic crisis exacerbated by the COVID-19 pandemic, the ongoing war in Ukraine, elevated global interest rates, and years of excessive borrowing.
President John Dramani Mahama, having assumed office in January, has committed to revitalizing the economy and addressing job creation. However, he is confronted with the repercussions of a cost-of-living crisis, reliance on a bailout from the International Monetary Fund, and the ramifications of a sovereign debt default in a country known for cocoa and gold production.
Ghana is facing significant external debt obligations, particularly in 2027 and 2028, amounting to $8.7 billion. Finance Minister Forson remarked on the lack of financial buffers to manage this burden. As the country strives to recover from a deep economic crisis, President Mahama’s administration will need to implement effective measures to address these fiscal challenges and support economic stability.
Original Source: www.cnbcafrica.com
