President John Mahama
Ghana's debt profile reached GH
¢58.4 billion, from GH¢52.1 billion at
the end of March 2014. Between
March and June this year alone, a
total of GH¢6.3 billion was borrowed
by the Mahama government.
The current National Democratic
Congress (NDC) administration
inherited a GH¢9 billion debt from
former President J A Kufuor's New
Patriotic Party (NPP) government in
2009; but the NDC government has
pushed it to almost GH¢60 billion –
making debt serving alone take a
substantial share of the country's
revenue.
The latest figure represents 55.4
percent of Gross Domestic Product
(GDP), according to Dr. Kofi
Wampah, governor of the Bank of
Ghana.
According to an economic expert,
'This means that Ghana is not far
from being declared bankrupt,
looking at the rising debt profile
against GDP ratio.'
The domestic debt component is GH
¢27.8 billion, representing 47.5
percent of the overall total.
However, in the face of the
escalating debt stock, the Mahama
administration is still borrowing
more at the expense of the ailing
economy, thereby earning the
President the nickname 'Nana Boro.'
Missing Targets
Dr. Henry Kofi Wampah, BoG Boss
Dr. Wampah told journalists in Accra
that government had been missing
its revenue targets in recent times,
explaining that total tax revenue
amounted to GH¢7.1 billion – lower
than the estimated GH¢7.3 billion for
the second quarter of the year.
'Total revenue and grants for the
review period was GH¢9 billion (8.5
percent of GDP), below the target of
GH¢9.5 billion (9 percent of GDP),'
he said.
Dr. Wampah indicated that the
underperformance of government
revenues during the first five months
of the year was partly attributed to
low import volumes, decline in
international gold prices and
production, which affected mining
sector corporate taxes and mineral
royalties. He also mentioned the
general slowdown in economic
activities as another factor.
DAILY GUIDE learnt that high taxes
and levies at the port, coupled with
rising inflation and the falling cedi
had contributed to low revenues to
the revenue agencies, particularly
Customs.
He said Gross International Reserves
(GIR) at the end of June 2014 was
$4.5 billion, corresponding to 2.5
months of import cover, compared
to $5.6 billion at the end of
December 2013.
This development, the Governor of
the Bank of Ghana said partly
reflected the seasonality in foreign
exchange flows during the year.
cephrok@yahoo.com
By Cephas Larbi
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