The government, which sold $3bn of eurobonds in March, aimed to sell a further $1bn of debt on the international markets this year. It dropped those plans in October, citing market conditions.
The failure to access debt markets is “worrying, but not catastrophic,” says James Dzansi, an economist at the International Growth Centre in Accra. “It’s a signal to the government that it needs to explore other options.” The easiest and most prudent course would be to go to the IMF sooner rather than later, he says.
According to the IMF, Ghana’s public debt stands at 79% of the GDP. However, Dzansi argues that debt to GDP is the wrong metric to measure Ghana’s position. More relevant, he says, is the ratio of debt-service payments to fiscal income. Fitch predicts that general government interest expense will be almost 47% of revenue in 2022. Dzansi says the country is spending about twice as much
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