The country’s debt stock reached GH¢94.5 billion in June 2015 from GH¢88.2 billion in May, representing 70.9 percent of Gross Domestic Product (GDP).
According to World Bank parameter, if a country’s debt-to-GDP ratio crosses the 70 percent debt mark, the country is classified as Highly Indebted Country.
Owing to the development, Ghana has officially been classified as HIPC, and if the debt is shared among the citizenry, it could mean that every Ghanaian now owes about GH¢3,600.
According to the IMF, Ghana’s current debt level is even higher than the period before the country was declared HIPC around 2001.
The debt stock of the country has increased astronomically since the National Democratic Congress (NDC) assumed office in 2009.
The NDC administration inherited a debt stock of GH¢9 billion in 2009.
During a press conference in Accra yesterday, Dr Kofi Wampah, Governor of the Bank of Ghana (BoG), said Ghana’s domestic debt was GH¢35.9 billion, representing 26.6 percent of GDP while the external was GH¢58.6 billion, representing 44.0 percent.
The Central Bank increased the monetary policy rate from 24 to 25 percent.
According to Dr Wampah, the increase in the monetary policy is to tackle the country’s growing inflation rate and the poor performance of the cedi.
“The decision of the committee to increase the policy rate is consistent with the bank’s forecasts, which requires further tightening in order to bring inflation back within the target band by the end of 2016,” he said.
The Governor said the committee would continue to monitor the situation and take appropriate action if necessary.
The monetary rate is the rate at which the Central Bank lends to commercial banks, and it is also used by banks to calculate base rates.
The current policy rate is the highest in over a decade.
Gross foreign assets as at the end of July 2015 stood at $4.4 billion, enough to cover 2.8 months of imports and goods and services, compared to $5.5 billion in December 2014.
By Cephas Larbi
A Freelance Journalist, Entrepreneur and Philanthropist. Editor-in-Chief of www.233times.com. A contributory writer for Ghanaian Chronicle Newspaper. An alumnus of Adisadel College where he read General Arts. He holds first degree in Bachelor of Arts from the University of Ghana; Political Science (major) and History (minor). He has also pursued MSc Corporate Social Responsibility (CSR) and Energy with Public Relations (PR) at the Robert Gordon University in the United Kingdom. His mentors are Rupert Murdoch, Warren Buffet, Sam Jonah, Kwaku Sakyi Addo and Piers Morganview all posts by: Nana Kwesi Coomson
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