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Ghana's debt within manageable limits - Gov't responds to Minority

A Deputy Information Minister has said it is misleading for the Minority in Parliament to criticize government for what it calls "excessive borrowing" without reconciling it with the numerous infrastructural projects government was undertaking.

The Minority claimed Ghana has borrowed eight billion Ghana cedis in eight months, but the governing National Democratic Congress(NDC) has insisted that the country's debt is within manageable limits.

The Minority in Parliament fears Ghana risks having its international credit rating downgraded, if government does not halt the trend of "excessive borrowing from both domestic and international markets".

NPP MP for Tafo Pankrono, Dr. Anthony Akoto Osei, who addressed the media on behalf of his colleagues said: "It also needs to be pointed out that this 49.5% debt ratio means the country is on the verge of crossing the 50% threshold".

But responding to the Minority, Felix Kwakye Ofosu, Deputy Minister for Information and Media Relations, told Joy News Ghana's debt to GDP ratio is better than top seven most industrialized countries in the world.

He cited the Debt to GDP ratio of Japan which is 237% while the U.S carries a ratio of 106%.

The public debt stands at GH¢43.9 billion as of August 2013, but the country is worth GH¢85 billion.

But Kwakye Ofosu said government is investing the monies borrowed into infrastructural projects and social services such as education.

The deputy minister offered to count about a 100 road projects that has been financed with funds borrowed by government. He mentioned the Awoshie-Pokuase road.

He also cited the following roads, "60km Assin Praso-Asante Bekwai, a 19.5km Agbozime-Afloa road, a 93km Tarkwa -Bogoso road, about 436km cocoa roads in cocoa-producing areas and a 74.8m euros Kwame Nkrumah Circle interchange".

He conceded that the NDC government is having difficulty in meeting its statutory obligations after failure to credit accounts of the District Assembly Common Fund (DACF), the National Health Insurance Fund (NHIF), the Ghana Education Trust Fund (GETFund), the Road Fund and others.

But the deputy minister said the Minister of Finance and Economic Planning had met the leadership of parliament "barely a week ago" to adopt a roadmap for making disbursement.

This difficulty is not the first time in Ghana's history, Felix said and explained that under the NPP regime some statutory payments such as the GETFund were not been made for two years.

He said government had other commitments apart from making statutory payments. He pointed out a "dramatically" high annual wage bill of GH¢ 9bn which is claiming 99.3% of non-earmarked revenues.

Clearly, he says, this situation will pose a challenge to government's ability to make statutory payments.


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