Gov’t dismisses Bawumia’s claims on public debt

Government has challenged figures put out by the 2016 NPP Vice-presidential candidate, Dr Mohamudu Bawumia about Ghana’s debt stock.

According to a Deputy Minister of Finance, Cassiel Ato Forson, Ghana’s public debt as at December, 2015 stood at ¢97.2 billion and not ¢99 billion as claimed by Dr Bawumia.

He also said the projected Gross Domestic Product (GDP) is ¢140 billion which yield a debt-to-GDP ratio of 69.45 percent contrary to the 73 percent figure given by the NPP Vice-presidential candidate.

Dr Bawumia’s claims:
Dr Bawumia in an interview with the host of the Joy FM’s Super Morning, Kojo Yankson on March 2, said the debt to GDP ratio of the country is hovering around 70 percent which is deemed to be dangerous and unhealthy for the economy.

He also said the inflation as at December 2012 was 8.8% and that the figure has changed to a record high of 19 percent mainly by the influences of high prices of fuel, food and utilities.

“What is most shocking is that His Excellency President Mahama clearly does not know the value of exactly how much this NDC government has borrowed in the last eight years,” he said.

However, Mr Forson said the figures of the NPP Vice-Presidential candidate are based on miscalculations.

Speaking on the Joy FM’s Super Morning Show, Mr Forson said the government has put in place measures to reduce the country’s fiscal deficit from 10.2 percent in 2014 to 7.5 percent in 2015 and Ghanaians should see this as a sign of relief.

Contrary to claims by Dr Bawumia that the IMF programme will hamper the growth of the country’s economy, Mr Forson expressed confidence in the programme saying “we will implement it and we will be successful.”

Senior Research Fellow of the Institute of Fiscal Studies, Dr Saeed Boakye, cautioned government to control its external borrowing adding that the current fiscal deficit of 7.1 percent is an indication that public debt is building up and government will have less to develop the country.

He disagreed with Mr Forson about the key role played by the primary balance in the calculation of the country’s fiscal deficit saying “The primary balance is of use to some extent but the fact is that we are looking at the entire fiscal balance. Let us talk about what is existing”.

He acknowledged there are attempts by government to balance the fiscal table but noted government has to look at the issue of interest payment which he described as taking revenue out of the country when those monies could be used for other purposes.

Story by Ghana||Austin Brako-Powers|Email: [email protected]

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