Dr. Cassiel Ato Forson outlined Ghana’s impending debt obligations exceeding GH¢150 billion in domestic payments and $8.7 billion in external debt over four years. A significant portion of these liabilities is concentrated in 2027 and 2028, posing risks to the economy. Despite these hurdles, the government remains committed to economic transformation.
The Minister of Finance, Dr. Cassiel Ato Forson, recently highlighted the financial obligations Ghana faces in the coming four years, particularly due to a debt restructuring program initiated by the government of President Nana Addo Dankwa Akufo-Addo. During the presentation of the 2025 Budget and Economic Policy, he detailed both domestic and external debt service payments, amounting to substantial figures.
Dr. Ato Forson revealed that the Domestic Debt Exchange Programme (DDEP) will require the country to allocate over GH¢150 billion from 2027 to 2028. He emphasized that these domestic debt payments would represent 11.6% of the nation’s GDP over the next four years. Notably, a staggering 73.3% of these payments (GH¢110.1 billion) is scheduled for the years 2027 and 2028.
The Minister described the debt obligations in 2027 and 2028 as “major humps” that pose significant economic risks, yet he expressed commitment to addressing these challenges. Furthermore, within this financial year alone, the government anticipates burdensome obligations in February, July, and August, amounting to GH¢9.9 billion, GH¢6.2 billion, and GH¢10.1 billion, respectively.
In discussing external debt, Dr. Ato Forson disclosed that Ghana will face external debt service obligations exceeding $8.7 billion in the same four-year timeframe, equating to 10.9% of GDP. He noted that a significant portion of this (55%) will be due in both 2027 and 2028, with responsibilities amounting to $2.5 billion and $2.4 billion respectively for each year.
This forecast indicates that the years 2027 and 2028 will be particularly challenging for Ghana, with heavy debt burdens. Despite these daunting tasks, the Minister reassured the public that the Mahama administration is prepared to tackle these financial hurdles while striving to transform the economy.
The Domestic Debt Exchange announced by former Finance Minister Ken Ofori-Atta on December 4, 2022, involved significant arrangements aimed at enhancing debt sustainability as part of the 2023 budget strategy. Noteworthy aspects included the replacement of existing domestic bonds with four new instruments having varying maturity dates and interest rates.
Ghana faces substantial debt obligations amounting to over GH¢150 billion for domestic debt and $8.7 billion for external debt over the next four years. The Minister of Finance, Dr. Ato Forson, expressed that years 2027 and 2028 will be especially burdensome due to significant debt service payments scheduled for those years. Despite these challenges, he maintains a commitment to effectively manage the debts and improve the nation’s economic landscape.
Original Source: www.ghanaweb.com
