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Business News of Friday, 26 June 2020


Minority wants independent audit of public debt

Haruna Iddrisu, Minority Leader in Parliament Haruna Iddrisu, Minority Leader in Parliament

The country’s public debt, as put out by the government, should be assessed by an independent audit firm to ensure transparency and consistency, the Minority Leader in Parliament, Haruna Iddrisu has suggested.

Ghana’s total debt reached GH¢236.1 bn at the end of March this year, according to the latest Summary of Economic and Financial data released by the Bank of Ghana after its Monetary Policy Committee met to review developments in the economy over the past two months.

The data further indicates that the GH¢236.1bn debt now sends Ghana’s Debt-to-GDP-Ratio to 59.3 percent.

Out of the total debt stock, US$22.9 billion was external debt, which translates into 31.3 percent of the total value of the economy, while GH¢111.3bn was secured locally representing 28 percent of the total value of the economy.

The country’s gross public debt as at last year was GH?GH217bn, according to the annual public debt management report for 2019.

The report further reveals that the nominal increase in the total portfolio was due to increases in both the external and domestic components of the debt stock, which represents 63.0percent of the GDP compared to 57.6percent in 2018; the ratio includes the costs of the financial and the energy sector bailouts.

However, the figures have been disputed in some quarters. It is this doubt that the Minority Leader reckons an independent audit will clear.

Contributing to the adoption of the report of the Finance Committee on the annual public debt management, he said the “public debt, as has been reported by the Bank of Ghana, stood at GH?236bn against what the NPP government inherited in 2017 January at GH?122bn.

“It means government has doubled the public debt in three and a half years. What I will ask for is an independent audit of Ghana’s public debt.

We asked for an independent audit of Ghana’s public debt because all the ratios–debt to GDP and debt as a percentage of revenue—would be better appreciated when we know where we stand in respect of our public debt,” he said on the floor of the House.

The Minority Leader also added that the public needs to know how much was borrowed from the Chinese government and its creditors in relation to the US$2bn Sinohydro loan.