Ghana is estimated to save nearly $2 billion this year due to the suspension of payment of its external debt, the Governor of the Bank of Ghana (BoG), Dr Ernest Addison, has stated.
The suspension of the payment of external creditors, he said, was a major relief to balance of payment and the economy as a whole.
Dr Ernest Addison disclosed this on Monday in an answer to a question on how the exchange rate was influencing the country’s debt stock during a press conference after the 114th regular meeting of the Monetary Policy Committee of the BoG.
He said on the basis of the exchange rate, the country’s external debt in cedi terms had increased.
According to the September 2023 Summary of Economics and Financial Data released by the BoG last week, Ghana’s total public debt as of June this year stood at GH¢575.5 billion, representing 71.9 per cent of Gross Domestic Product (GDP).
The external debt component, according to the data, increased from GH¢326.9 in May 2023, representing 40.8 per cent of GDP, to GH¢328.6 billion in June 2023, representing 41.0 per cent of GDP.
However, Dr Addison said the country this year had witnessed an improvement in the current account balance due to the suspension of the payment of external debt.
He said the country recorded a positive current account balance of $859.1 million in June this year against the negative current account balance of $1111.9 million in the same period last year.
The Governor said the discussions with the country’s external creditors –both bilateral and bondholders – as part of the country’s debt restructuring, were going on successfully, saying “the initial terms I have seen suggest we will be successful”.
Touching on the IMF ECF programme with Ghana, he said the programme was yielding positive results and “doing what it is supposed to do”.
He said growth was improving and inflation was trending down, adding, “Since the end of December, we have seen substantial drop in both food and non-food inflation, we have seen the exchange rate stabilised.”
BY KINGSLEY ASARE
