The Ghana Statistical Service (GSS) has disclosed that it will release the Ghana’s Quarterly Gross Domestic Products (QGDP) tomorrow, Wednesday, 19th April 2023.
The International Monetary Fund (IMF) in its Fiscal Outlook Report released at the Annual IMF/World Bank Spring Meetings in Washington DC, USA, is projecting that Ghana’s debt-to-GDP ratio will stand at 98.7% by the end of 2023.
The IMF, in the report, also forecast the debt-to-GDP ratio to reduce marginally to 92.8% in 2024.
The Director of Fiscal Affairs at the IMF, Vitor Gaspar, advised the government of Ghana to ensure that the country’s fiscal policy is consistent with its monetary policy to restore price and financial stability while supporting the most vulnerable.
“Abrupt changes in financial conditions also call for fiscal restraint to tackle fiscal vulnerabilities. To that end, governments will need to give greater priority to rebuilding fiscal buffers by developing credible risk-based fiscal frameworks that promote.”
Vitor Gaspar
The Bank of Ghana’s economic and financial data report of March 2023 showed that Ghana’s total debt stock ending November 2022 stood at GH¢575 billion, representing 93.5% of GDP. However, based on the gross debt levels projection, that could be going up by about 5% for 2023.
The major implication of this higher-than-projected GDP outturn for 2023 is that all economic indicators expressed as a ratio of GDP will change to reflect the updated GDP data. These ratios include the debt to GDP ratio, a key factor in determining debt sustainability, the fiscal deficit to GDP ratio, and Revenue to GDP ratio.
Ghana recently undertook a domestic debt exchange programme (DDEP) to reduce the country’s debt stock.
Some analysts have stated that the current debt restructuring by the government may impact the debt numbers by the end of 2023.
The Finance Ministry in its Debt Strategy Paper had indicated that the Domestic Debt Exchange Programme will end up restructuring about ¢138 billion worth of bonds.
Same time last year in the first quarter, the economy of Ghana advanced by 3.3% in the first quarter of 2022, slowing from a 7% expansion in the previous period. It marks the weakest pace of growth since the last quarter of 2020, as activity slowed markedly in the industrial sector (1.3% vs 4.8% in Q4) due to a decline in the production of oil and gas.
Slower growth was also recorded in services (3.7% vs 8.1%) and agriculture (5.6% vs 8.2%). The nation is currently battling a set of challenges including runaway inflation, a depreciating local currency and high public debt.
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